Making a start. You do not have to be rich to invest but you do have to invest to be rich.
Most people can save money but becoming an investor requires diligence and a certain amount of common sense which a lot of savers do not possess. It is for this reason that a retirement savings scheme where a small percentage of your gross income is paid into the scheme is an excellent option. The money is taking out of your wages that it is virtually unnoticed. It is with fund managers who invest it on your behalf. Using their knowledge. Another advantage is that your money is diversified among a number of companies. This reduces your risk.
Having money set aside for the sole purpose of your retirement has to be part of your financial plan and is the responsibility of each individual. As I said at the beginning, the key to investing is making a start.
Experience is your best teacher. Doing your homework and reading about all of the different kinds of options available to you when investing is all very well but at some point you have to get down to the nitty gritty and make decisions on where to invest your money. It is all about backing your judgment.
There is no excuse for being financially illiterate with so many books on financial matters and you don’t have to spend money to have access to them as you will find them at your local library.
Having a goal is important because you will just fritter your money away on stuff which is meaningless if you do not know where you are going. Having goals requires vision. It is making choices today which have an impact on your future. If you do not save and invest then your future or aspects of it will be in the hands of others.
There are consequences for not making provision for your future. One is that if you are purchasing a car and you have no savings then you are at the mercy of finance companies. They are happy to lend you money to purchase a car.
When you borrow money to purchase things such as a car or household appliances you are accumulating liabilities. Anything that costs you money is a liability.
You do not have to be saving for anything in particular to start investing. Building up a portfolio of shares to give you an interest in the markets is something Mum and Dad investors like to do. In this day and age this can be done easily with so many online share market platforms available.
In this age starting takes more effort than continuing. People are so set in their ways that they find it hard to change-moving from thinking about investing or saving to actually doing it.
Waiting is costly!
Many people are waiting till the time is right before investing. They wait for their debts to be paid off, they wait for a promotion, wait for the share market to drop or wait for some circumstances in their life to change. All of this waiting means that they are not taking advantage of compounded interest which can snowball their wealth.
Not only that; they are missing out on the experience which comes from getting involved in the markets.
Taking that first step whether it be setting up an emergency fund, a brokerage account, or a retirement fund shifts your mindset from spender to saver, from saver to investor.
The best time to plant a tree was twenty years ago and the second best time was yesterday.
About this article
This article is not considered as financial advice, therefore discretion is advised. You may use this article as content for your blog/website or ebook.
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