Do you find that you work just as hard at keeping your money as you do at earning it in the first place? Then, you realize it’s not enough just to earn money. To make the most of your almighty currency, you must have your money working hard for you too!
You could put your hard-earned cash in a saving account, but with savings rates earning less than the cost of inflation, how hard is your money really working? Not hard enough.
No doubt you’ve heard about the benefits of investing. Whether it’s in a brokerage account or a retirement account, you could do much worse than investing in reputable companies to potentially receive a substantial return on your initial investment.
Continue reading how your money can work harder for you.
What follows are five common investing myths and why you shouldn’t let them stop you from taking greater control of your financial future.
Myth #1: Investing is expensive.
You’ve likely heard the saying, “it takes money to make money”. Of course, you can’t invest with an empty wallet. However, with many investment platforms reducing or doing away with transactions fees, it’s never been more affordable for the average person to invest.
Myth #2: Investing is too risky.
Yes, if you don’t invest responsibly, you could lose your shirt and your pants too. But investing isn’t supposed to be a path to quick riches. If you buy reputable investment instruments with a focus on incremental gains over time, investing is less likely to be an adrenaline-spiking experience.
Myth #3: Investing is too complicated.
Maybe so, if rather than an options strategy, you think a “straddle” is something a gymnast does, or a “collar” is a part of a dress shirt. But you don’t have to know all the complexities of investing to get started. Depending on your risk tolerance, you could do well by sticking with stocks, mutual funds, or exchange traded funds (ETFs).
Myth #4: Stock-picking is hard.
Sure, the experts spend a great deal of time pouring over financial statements and staring at stock charts to ensure they are picking the right investment at the right time. As a long-term-focused investor picking reputable stocks, your point of entry is less critical, especially if you’re adding to the investment over time. What are the companies you’re hearing about most? What products and services do you use the most? Are the popular companies or those providing your favorite goods and services publicly traded? If so, start there. You’re already familiar with these companies and you’ll likely find it easier to stick with these investments because you believe in them.
Myth #5: The stock market is rigged.
It is easy to assume the stock market is rigged if you or someone you know has been on the wrong side of an investment. In all truthfulness, there are many regulations in place to make the stock market a safe place to invest. That doesn’t mean there is no risk. It just means that there are financial and criminal consequences for trying to take advantage of investors. However, it also doesn’t mean you get to cry foul for being naïve or ill-prepared.
Hopefully, now you see these myths for what they are – silly notions perpetuated by the fearful and the misinformed. If you take investing just as seriously as you take earning your money, you could benefit from putting your earnings to work through investing.