If you've clicked on this article, you're obviously thinking about investing...
You're also wondering whether or not you should. Aside from retirement accounts (IRAs and 401(k)s), which we will discuss more in other articles, the notion of investing your personal money can be scary - and it should be. It's a big decision, with many factors to consider.
Some of the things that are going through your mind might include the following, which I will deal with in order:
There are surprisingly few ways you can actually lose all of your money - and most of them can be boiled down to a failure to diversify. Remember the old saying "don't put all your eggs in one basket."? This means that there is a lot of potential advantage in spreading your money across multiple investments. Diversity is not only a great way to structure a team, or a board of directors, it's also usually the best way to build an investment portfolio. Aside from a failure to diversify, the other easy way to lose a great deal of money very quickly is by using too much debt. You know that mortgage you are told was a great financial move? Well, imagine if you were unable to work and had no insurance.... that can be a one way express pass to zero.
This one is a little more murky... in general, if you're shouldering a bunch high interest debt (eg. payday loans, personal loans, or credit cards), investing probably isn't for you. Instead, you should probably think about diverting any extra money towards getting your debts under control (and the expensive debts gone completely) before worrying about investing. Aside from debt, if you regularly have trouble paying your monthly bills, investing might not be right for you. I'll sum it up with this: if you can comfortably put aside money on a regular basis - and you expect to be able to do so on a long term basis - then investing is probably a very good idea for you.
If this is your only issue, then you're in luck! The planet is literally overflowing with people and companies willing to offer you their advice. If you've found your way to us above all the others, then you might consider starting your investment journey We work hard to make investing simple and painless, so you can focus on other areas of your financial wellbeing like buying less junk from Amazon, or starting a profitable side-hustle.
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