Oh no, another article on why you should start investing! You’re probably as tired reading articles on how to start investing as I am but there’s one point you may have missed. Many of the investing articles do a good job at outlining how to start but miss one of the most important reasons to start investing and the urgency to start now.
After missing out on the biggest reason to start investing, many articles wander off into overly complicated strategies on how to invest. Strategies that are ultimately going to lose you money and sour you on investing before you get a chance to see the benefits.
Don’t miss out on your chance for financial freedom through investing and don’t get hung up on the ‘how’ of investing.
Why Everyone Should Start Investing Now…like right now!
I understand that it’s not always easy to put money aside after all your bills are paid. I’ve been there, living paycheck to paycheck. It’s easy to talk about investing and saving when you’ve got extra income, it’s not as easy when you’re trying to support a family on limited means.
We talked about squeezing a little extra out of your budget and finding out how to prioritize saving in our free budgeting worksheet. Even if you’re only able to save $50 a month, it’s hugely important that you get started now.
The biggest reason to start investing is the power of compound interest which is just a technical term for making money off your money. Start investing in your 20s and you’ll be earning interest on that money for decades as well as earning interest off your interest. The graphic below shows the power of investing early and growth in $50 monthly contributions from different ages.
Invest more than $50 a month and you’ll see even bigger benefits to investing early.
Another reason to start investing is simply to change your role in life. Living paycheck to paycheck, constantly just paying bills means you’ll always be renting from the owners of wealth. Investing in stocks, bonds, real estate and other assets means you are an owner rather than a debtor. You own the assets that other people rent and can control your own financial future.
It’s one of the keys to financial freedom, stop renting your life and start owning it!
How to Start Investing Now for your Financial Freedom
I plan on covering how to open an investing account and different online investing options in an article next week. There are quite a few options available, almost too many, but the fact is you really don’t need many of the special features that come with different brokerage and investing accounts.
Starting investing means understanding how much you need to reach your financial goals and how much risk you’re willing to take. We looked at how to create a personal investment plan in an earlier post, an essential plan for any new investor.
Opening an online investing account will save you from the higher fees charged by brokers. I opened an account on Scottrade for its low fees and cash bonus offer. The investing website offers one of the lowest commissions at just $7 per trade and all the tools you need to start investing now. The site is also offering a limited-time cash bonus and free trades to new investors.
I’ve spent my career analyzing stocks and learning how to manage people’s investments. The simple truth though is that you really don’t need all the technical insight to do very well investing, in fact sometimes all the investing strategies cause more problems than they’re worth.
Plan your investing strategy around the top 10 investing basics and you will be closer than most to reaching your financial goals. While investing is about making money off your money, a lot of your account is going to be the regular deposits you make. In fact, earnings don’t account for more than your deposits until nearly two decades of investing at the market return.
It’s only through being an owner of assets that you’ll be able to achieve the financial freedom that many take for granted. It can be intimidating to start investing and planning for your future but it really can’t wait. You don’t have to jump at it with everything you’ve got but it’s so important to start investing now.
If you're looking to take a more hands-on approach in building your portfolio, a brokerage account is the place to start. Brokerage accounts give you the ability to buy and sell stocks, mutual funds, and ETFs.
A stock portfolio focused on dividends can generate $1,000 per month or more in perpetual passive income, Mircea Iosif wrote on Medium. “For example, at a 4% dividend yield, you would need a portfolio worth $300,000.
Making $4,000 a month based on your investments alone is not a small feat. For example, if you have an investment or combination of investments with a 9.5% yield, you would have to invest $500,000 or more potentially. This is a high amount, but could almost guarantee you a $4,000 monthly dividend income.
Even with just one dollar, you can start building your portfolio. Fractional shares allow investors to purchase a small portion of their preferred companies or funds, without having to buy a whole share.
There's no minimum income you must earn before you can invest. But it's important for your long-term financial security to set aside money for emergencies and to have debt under control. Once you've put those plans into action, you're ready to invest.
If you think $100 won't be enough to invest, think again. With a little patience and discipline, you can grow that small sum of money quickly. After all, the amount you invest at first is not really what matters when it comes down to it. It's all about getting started.
You can certainly start investing with $10 per month, and it's a great way to develop a regular savings habit and gradually build your investment portfolio. While $10 per month may seem like a small amount, it can add up over time through the power of compounding.
Cash. A cash bank deposit is the simplest, most easily understandable investment asset—and the safest. It not only gives investors precise knowledge of the interest that they'll earn but also guarantees that they'll get their capital back.
One of the easiest passive income strategies is dividend investing. By purchasing stocks that pay regular dividends, you can earn $2,500 per month in dividend income.
Perhaps the most common are stocks, bonds, real estate, and ETFs/mutual funds. Other types of investments to consider are real estate, CDs, annuities, cryptocurrencies, commodities, collectibles, and precious metals.
Key Takeaways. Safe assets are those that allow investors to preserve capital without a high risk of potential losses. Such assets include treasuries, CDs, money market funds, and annuities. There is, of course, a risk-return tradeoff, such that safer assets typically offer comparatively lower expected returns.
Introduction: My name is Wyatt Volkman LLD, I am a handsome, rich, comfortable, lively, zealous, graceful, gifted person who loves writing and wants to share my knowledge and understanding with you.
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for its low fees and cash bonus offer. The investing website offers one of the lowest commissions at just $7 per trade and all the tools you need to start investing now. The site is also offering a limited-time cash bonus and free trades to new investors.
