5 Ways Young People Can Get Over the Fear of Investing
There are several reasons why young people today fear investing their money. If you are one of them and you would like to get started investing, this article is going to explain how you can finally get past those fears.
Ask Lots of Questions
Don’t let the fear of failing keep you from investing your money. First examine what you are really afraid of. Are you afraid of admitting you don’t have all the answers or knowledge other people have? If you are scared of looking foolish in front of other people, you are not alone. Consider this: No one ever knows how to do anything until they have done it the first time.
You aren’t stupid if you ask questions. However, you are, at the very least, a little silly if you don’t know something and doesn’t ask. That sounds pretty simple, doesn’t it? So go ahead, ask questions. You might just learn a lot!
Invest in Small Amounts if Necessary
One other obvious reason young people don’t invest is because they feel they don’t have enough money to do so. However, it doesn’t take thousands or even hundreds of dollars to get started. There are some mutual funds, for instance, you can purchase for around $10.00 per share. Or, you could invest by putting money into a 401K plan if your employer offers one. Dividend Reinvestment Programs (DRIPS) are great ways to get started as well.
Do a Little Homework
Ask friends or colleagues about their experience with investing. You will find that even when the market goes down, if you leave your money in these funds, the gains usually make up for their losses. This is not always the case, of course, but if you choose wisely and look at the history of each fund, you should have success.
Search the internet if you have questions about a particular investment type, or take a class. You could also go to your local library and read about investment strategies. These are all good ways to get over the fear of investing. You don’t have to be an expert to get started because you will learn along the way.
You can also invest with a company that gives you a lot of feedback as to how your investments are performing. There’s nothing better than learning by doing with some experimental investing.
Establish an Emergency Fund
If you are still afraid of losing your money through investments, consider putting part of it into a savings account for emergencies, and part of it into your investment option. This way, not all of it will be lost if your investment falls through. As you feel more and more comfortable, you can always invest more. It’s never a bad idea to have an emergency fund you can access when you need to, even if you decide to hold off on investing for the time being.
Play to Your Strengths
If you are good with tools, maybe investing in real estate is the way to go. Save some money for a down payment, do some homework and purchase a fixer upper you can either flip, or turn into a rental property. Or, join with a partner or family member you trust, and you will have enough money for the down payment that much sooner.
You’ve probably heard the saying, don’t put off until tomorrow what you can do today. This is true for a great many things, including investing. The younger you start, the greater your return.
Depending on your investment choices, you could end up with 2 or 3 times as much money if you start by the age of 30 than you would by waiting until you are 40 or older. Thinking you’ll do it later or next year because you have plenty of time is costing you money right now. You don’t know what the future holds, so get started today.