Money sitting in the bank is good for nothing but for inflation to work its magic and be worth less and less. That’s why the best thing to do is to keep it moving, working for you. One of the best things you can do is to invest it, either in the stock market or other types of markets.
However, investing is not advisable for someone who has only seen the stock market in movies, series or on the news. Since it requires a sufficiently solid knowledge base to know how to move and not end up losing money. That is why I am going to give you some advice at the moment of wanting to enter to invest.
⚠Nevertheless, it should be noted that I am NOT a financial advisor or anything like that, investing has its risks and each of you must assume your own or hire an advisor and / or broker to advise you. Well what you are going to read below is very basic level, mere simple tips on where to start. ⚠
Having clarified this, which I consider important, let’s begin:
First… Invest in yourself and your knowledge: read specialized books
It may sound cliché or even outdated given the digital era in which we live, where at the stroke of a keystroke we reach an almost infinite source of information. But while this is true, there are people with extensive knowledge who have condensed it into a book. Whether for recognition, to earn money, to meet that goal of writing a book in his life or perhaps all at once.
The fact is that, although the Internet is full of information, books usually condense quite well what is usually called “golden nuggets” and saves a lot of time searching. Besides encouraging reading, which is good for the brain.
Of course, make sure you buy the right book from the right author, as there are many “gurus” out there who will try to sell it to you (but this happens both in book format and on the internet, there is no escape from meeting these charlatans).
Audiovisual information… Good, but with care
Maybe you don’t have enough time to read (and reread, which is sometimes necessary), or maybe you’re too young and don’t have the money to buy anything but want to start learning…. But luckily, there are alternatives.
Whether through YouTube videos or podcasts, it is becoming easier and easier to learn while doing other day-to-day tasks. For example listening to an audiobook in the car/bus on the way to work/class. Or instead of watching that fifteenth kitten video you could watch one in between on finance and/or the stock market.
The thing is that you take good advantage of this format, because it is true that in an audiovisual way we retain information better than simply reading it. However, try to avoid unnecessary distractions while watching videos or similar, because in the end if they say something that you find complex you may not stay with the information until you see it several times.
Oh, by the way… As I said in the previous section, in this format there is no escape from the so-called gurus (in fact here they proliferate more due to the non-existence of the economic barrier of publishing a book). Always be on your guard, as it is always easier to be taken advantage of the less knowledge base you have.
Theory is fine, but nothing is better than practice
It is useless to soak up knowledge if you do not use it and put it into practice, this applies to everything. Of course, in this case we are talking about “playing” with something serious such as savings or part of the salary.
However, there is something called “demo account” in the vast majority of brokers. This means that we can invest in the stock market with totally fictitious money (without losses… or profits, of course). Generally most of these demo accounts are 100% free with the objective of familiarizing you with the platform and/or interface and encourage you to invest real money when the time comes. But I advise you, just in case, to check the conditions of each demo account you want to try.
Once you find the one that suits you best, don’t be afraid of messing it up. Many demo accounts, besides being free, have the option to reset and start from scratch (useful when you leave it at zero). Spend as much time as you consider necessary to learn, because the next step is to invest your own money, and there is no reset whatsoever…
Study well what you are going to invest in
As I already mentioned in this other post about cryptocurrencies, you always have to investigate what you are going to invest in, it is useless to invest if it is not done properly. By this I mean that nobody would want to buy shares of a company that loses money every day and is close to bankruptcy, right?
Study each asset in which you are willing to invest, after all it is your money that is at stake. This step is boring for most people, as it requires looking at a lot of numbers, graphs, news… But if done right it is the pillar that will keep you calm in each of the investments you make.
And that’s all, I know that for some people it will have been super obvious everything mentioned, but for those who don’t know how to start it can be helpful. Anyway I will work on some post about investment where I will go a little deeper for those who already have a minimum base.