Studies show that 71 percent of millennials are saving for retirement, yet 66 percent aren’t investing because they find the stock market scary.
It makes sense, considering this group came of age during the Great Recession of 2008. Watching friends or relatives get dragged through the aftermath has soured their perception.
It’s a shame, since learning how to invest may be the most lucrative way to build wealth.
If you’re new to investing, then you’ve come to the right place. Welcome to Wealth Building 101! Here, you’ll discover five pieces of the best investment advice.
1. Escape Your Debt
The most important information on how to invest is also the most difficult to do. In fact, the average American has $38,000 in debt (not including mortgages).
Eliminating or reducing debt is crucial to successful investing. Debts often have staggering interest rates, especially credit cards. The interest rate will likely be higher than any return on investment.
Interest is empty money, and your bank account will be healthier once it’s gone.
2. Homework Isn’t Just for Kids
Research can be the difference between the best investment and the worst. The most successful investors have revealed their secrets to the public. You only need to take hold of those tricks.
One of the best pieces of investment advice is to always do your homework. Look for red flags like company debt. Make sure not to rely solely on their past success either.
Perhaps above all, don’t trust blindly or let your emotions run your decisions.
3. Start Young, Retire Early
If you don’t want to retire early, you could retire a multi-millionaire. Investing in your IRA means that you’re investing in yourself later.
Knowing where to invest money is vital to building wealth. One of the most popular indexes is the Dow Jones Industrial Average Today.
It’s made up of 30 of the most successful public businesses on the market and is well known as a reliable index.
4. Diversity is Key
Diversifying your portfolio is the best way to protect yourself against losses, even if you invest in risky stocks.
Luckily, you can choose portfolios with pre-diversified stocks. Remember to take risks to maximize your profit, but also realize the importance of having safe stocks.
5. Failing to Plan is Planning to Fail
If you’re just learning how to invest your money, creating a budget is the number-one place to begin.
Map out your mandatory costs (rent, insurance, etc.), your leisure spending, and your goals. Once you have a place to start, you can begin to cut down and save on unnecessary expenses.
Long-and-short term goals will give you an actionable objective to work toward. Take a few hours this week to construct the perfect budget, and reap the benefits for years to come.
Time-Tested Investment Advice
Stocks may seem intimidating at first, but they’re one of the best ways to invest money. You’ll find that investing is exciting and incredibly rewarding.
If you want to increase your worth and build your wealth, take a look at budgetandthebees.com! There are endless pieces of great investment advice, and your wallet will grow full and happy.