Investing is hard.
No matter if you are a seasoned investor or a new one (even if you're not a child/young adult), beginning to invest your money – obviously with the hopes of watching it work for you and grow – takes careful planning and consideration to ensure success.
In light of that fact, we wanted to use this blog to help new or less experienced investors understand three keys to starting their investment journey even if they don’t know anything about how to invest.
Here we go.
1. Only Invest Money That You Can Afford To Lose
As an inexperienced investor, although we would also reiterate to seasoned investing experts, it is crucial that you do not invest beyond your means. By that, we want to stress how important it is to only operate or “play” with money that you are willing and able to lose because, should an investment unfortunately fail, you will always want to maintain your ability to live comfortably. You never want to find yourself in a position where you are struggling to pay your bills at the end of the month and remaining cognizant of how much money you can comfortably invest with will help accomplish this goal.
2. Only Invest In Things You Know About
We all want to be one of the first people to invest in the next big thing… the next Bitcoin, NFT etc. However, particularly as an inexperienced investor, we would advise to go with more of a “buy what you know” strategy – at least at first. The smartest strategy for beginner investors is to stick to investing in familiar, large companies that you can be more sure have a safer floor and a more certain future ahead of them. Your strategy can change in the future if you begin to experience more investing success over time, but we would recommend starting your investing journey playing on the “safe” side.
3. Create A Plan
This is an important consideration in all areas of life because you never want to go into any risky situation without a plan but this is never more imperative than when you are dealing with money. Have a plan for where you want to invest your money, how much money you are comfortable investing and where you might consider investing some money in the future if your existing investments provide good returns. Set benchmarks for what you consider “success” with a specific investment within your plan so that you can progressively widen the number of places you invest and the scope of your investment strategy in order to make the most of your money as a beginner.
Now that we’ve helped you get some ideas for how to start investing without knowing anything, we want to also help you set your child up with a head start towards gaining key financial literacy knowledge to help them in their own futures.
To do this, we encourage you to check out our learn to invest programs, where we offer 8 levels of our renowned Camp Millionaire series. This series of programs is designed to help students in grades 7 through 11 learn financial investment concepts in a step by step program and simultaneously participate in investment challenges along the way that give them both theoretical and practical knowledge of how to invest.
We are confident that our programs will set your child up on the right path to become the next great young investor and a completely independent, financially literate adult in the future.
Please check out our website and sign up today!