Learning how to invest when you’re new to the world of finance is difficult but entirely possible. Deciding to take this journey on your own is a bit more worrisome, not because it’s impossible but because it’s natural to feel scared when you’re playing with your own money. Even if you don’t enlist the help of a professional, however, you can still invest like a pro, and reap the rewards of your financial risks.
Set Aside Your Desired Sums
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Don’t make the mistake of thinking you need huge sums of money to start investing. Many people start out with as little as $20 and work up from there. Whether you have $50 or $500, you can put your money in an investment account. If you want to invest more right from the start, that’s no problem either—just go about it the right way.
Before putting your money anywhere, take some time to save back larger sums. Only put back what you can afford from your checks, bonuses, or extra funds. Do not take money out of your savings account, start selling things, take out loans, or borrow anything from your friends and family.
Make Use of Reputable Advice
As you save back money, start getting advice. Just because you choose not to use a professional broker or money manager, it doesn’t mean you don’t need a little help. There’s a lot of free help available from a variety of sources. Follow Fisher Investments MarketMinder on Twitter to get great advice about the stock market, or to find tips and tricks for new investors. Read some finance books, ask friends and colleagues for tips, and speak to someone at your bank. There are many sources available for assistance, so you can get professional advice without paying professional prices.
Choose How You Want to Invest
Getting advice will help you decide how you want to invest your money. If you’re starting out with smaller sums, there are several opportunities available. Think first about “drips,” which are DRPs or Dividend Reinvestment Plans. DSPs, or Direct Stock Purchase Plans, are also possibilities. Look for affordable stock options, mutual funds, and bonds as well. Since you aren’t paying a commission fee, all of your money will go toward your ultimate investment goal. If you have more money, look for larger stock options, IRAs, or index funds.
Decide Where You Want to Invest
If you’re not interested in going through a broker or money manager, then think hard about where you’d like to invest your money. A more traditional house is out, since you’ll get stuck paying commission fees. That typically leaves you with two choices: your bank or credit union or a discount house. At your bank, while there are financial planners available to you, you don’t have to use them. However, if the advice is free, take it. Discount brokerage firms don’t offer professional help. While it costs to buy and sell, the fees are small. Think about going online too.
As long as you make smart decisions, you can easily and successfully take this journey alone. Do you prefer investing on your own or with professional assistance?