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4 Investment Tips to Get You Started
For those keen but nervous to get started, we've some simple tips to help kick-start your investment adventure.
Millennials are like Scrooge McDuck, we hoard our money like our lives depend on it. When every dollar and cent we earn goes to the next vacation or the future home, investing can seem like a very alien concept. When was the last time any of us thought about investing anyway?
A recent survey answered this exact question. As you would expect, Millennials aren't doing very well in terms of investing. Out of a group of 1,000 young people aged between 18 and 30, around two-thirds had not started investing. Common reasons, according to the survey, include everything from a lack of funds ("No money!") to the lack of knowledge ("No idea!").
Here's the thing: If you invest smartly, you're essentially putting your money in the right place and watching it grow. Sounds great, right?
Investing does require some technical know-how. However, Millennials, more than anybody else, should be the ones investing for one simple reason: Time is on their side. And time, as a wise man once said, is money.
Here are some tips to get you started with your first investment:
"Start With What You Know"
You would not dig into a plate of mystery meat if you didn't know its origins, right? Similarly, if you don't yet understand a business, it's wiser not to dive headlong into it. The great thing about investments is that, no matter what you're actually interested in, it is possible to translate that interest into valuable trading information. If you are a tech geek by day, for example, you may already know a handful of tech start-ups, such as Patreon and Carousell, with a lot of potential. By focusing your picks on companies and industries that interest you, you will likely make more informed choices.
"Balance Your Risk"
Investing for the first time is risky, but then so is driving a car or crossing the road. Everything in life involves a certain amount of risk, but the more important point is to take calculated risks. For example, even though traditional savings accounts (where you deposit some money with a bank and earn its interest rate) are considered safe, they also reap lower rates of return in the long run. So instead of putting all your eggs in the same basket, invest in a variety of things. That way, you will increase your chances of seeing significant financial growth.
"Avoid the Herd Mentality"
Just because everybody else is investing in something, does not mean you should jump on the bandwagon. At the end of the day, it's all about doing your homework and knowing the best move for you before following trends. This goes back to point one: if you don't know anything about gold, don't invest in it just because a friend tells you to. And if you are interested, read up on the topic before taking a leap.
"Find Advice You Trust"
Lastly, finding someone who can offer you unbiased advice is incredibly important to get you started. If you have never delved into the world of investing, it is easy to feel overwhelmed. That is why you want someone to guide you through this unchartered yet exciting territory.