Are you risking all your savings or keeping an emergency portion? 9 steps to learn before you start investing

If you were traditionally educated in schools, you probably didn’t learn anything about financial management and investing. But as you grow up, you will discover that knowledge of the ABCs of investing is essential to securing your financial position in the future.

Writer Todd Kunzman says – a report Published by the American “Investedwallet” website – Many people face difficulty in getting into this immersion and discovering investment rules, especially if no member of their family is active in this field. But actually you can learn on your own, and it’s not as difficult as you might imagine.

Buy and read investment books

One of the best steps to take in this world is to buy books that provide you with a look at investment operations, the various opinions and strategies adopted in the stock market, and the best options in which to put your money.

Learn investment terminology

One of the most confusing things in this field is the vocabulary used by experts in this field, which sometimes you see in press sites, books and advertisements on television, and sometimes accountants and experts deliberately use these elegant words even though they seem difficult to the public.

All those vague phrases—referring to market volatility, investment types, index funds, and the average cost of the dollar—you can understand, and don’t panic the next time you read financial reports and stock market news.

You can learn these things by underlining or coloring all the words you don’t understand in books and articles, and then coming back to them again to look for their meanings and interpretations.

Attending corporate meetings

If the company you work for provides meetings and educational lectures in the field of financial planning and investment for employees, you should not miss the opportunity to attend. These classes are usually supervised by the Human Resources department, and they help employees plan for retirement and make the best use of their savings and grants.

Start reading mutual fund prospectuses

When you begin investing in mutual funds, index funds, stocks or bonds, the broker will present you with something called an investment prospectus, which is an official and mandatory document, filed in the United States with the Securities and Exchange Commission.

This prospectus contains all the details about the investment offered to the public, and it may be related to the offer of shares, bonds or mutual funds, and it helps investors to make their decision based on accurate and official information.

Follow and read personal financial management sites

When you begin your journey to discover the world of investing, you will be encountered by many financial websites and blogs. There are hundreds of such websites that may be useful to you besides reading books. They offer expert opinions and diverse experiences in this field, and help you make the right decision.

Get online investing lessons

If you want to develop your skills and don’t know where to start, you can take a course in investing that introduces you to the basics. There are some free or low cost lessons that will help you learn and take your investing abilities to a higher level.

These lessons provide you with many advantages, including defining the learning format according to your circumstances and desires, identifying the things you need at the beginning, and providing you with expert training.

Learn from stock market simulation software

Another excellent way to learn is stock market simulation software, and if your plan is to invest in individual stocks or you want to speculate in the markets, this software will give you the necessary experience, as it simulates the movements of the stock markets, and you can participate in it without paying money.

Start investing with a small amount

The best way to learn is to practice, and this applies to all people and fields. In order to develop your investment experience without risking your savings or capital, you can start this journey with an investment of a small amount, sometimes not exceeding $5. There are some mobile apps for small investments, which allow you to participate with just two dollars.

Follow the investment forums

Online forums are also useful learning tools. They are open spaces for discussion, questions and presentation of ideas and experiences, in which people from all backgrounds and experiences participate.

And when you participate in these forums that are concerned with financial management, do not follow the advice or instructions that are given to you with all naivety, but you should always do additional research and advice and think well before making any decision related to investing your money, especially since the experiences of others and their opinions about profit and loss may not suit you , or does not apply to you.

Things to consider before investing

The writer says that each person is required to answer some questions before investing, in order to be frank with himself and be aware of all the opportunities and risks he faces.

For example, if you owe the bank a large amount, you must settle this debt and pay the amount taken from your credit card, before the bank charges you fees and interest.

Experts also advise that you have an emergency savings fund, before you start investing your money in the markets. The reason is that life is full of surprises, and you should always be sure that you have enough money in case of emergencies, which should represent approximately 6 months of expenses.

You must also think in the right way before you start investing, and put aside the emotions, preconceived ideas and hasty decisions that negatively affect your investment portfolio, as the market is full of fluctuations, and this affects your psychological state, and may make you make hasty decisions that cause you a heavy loss.

More Riyadah

Leave a Reply

Your email address will not be published. Required fields are marked *