Start small. Investing doesn’t have to happen a million dollars at a time or even a thousand dollars at a time. You can start by putting aside a hundred, or fifty, or half your bar tab. How about part of that tax return? Don’t do something stupid and put that money down on a Bentley.
Invest in what you know. If you eat a hamburger and drink a coke every day for lunch maybe you should buy stock in McDonald’s (MCD) or Coke (KO). Wear crocs with dress socks to weddings, you can buy Crocs. If you shop at Sears (SHLD) then, wait a minute, nobody shops at Sears but you get my point. You’ve got great investments all around you and you don’t even know it. You’ll be more interested in what you’re invested in and you’ll have more faith in the stock you bought.
Guys like Jim Cramer say you should invest your first $10,000 in index funds. Jack Bogle wants you to invest all your money in index funds. That’s all fine and dandy but where’s the fun in that? It doesn’t have to be that boring. If you feel confident in a company’s long-term prospects, it’s fine to invest in them. Since you’re only investing a little bit of money, you don’t have much to lose. You’re broke, remember?
You can start by opening up an account with Sharebuilder, or Etrade (ETFC), or Zacks Trade, or whoever you want. The important thing is just to start. You’ll be shocked how quickly it adds up. Compound interest baby. $100 a month at age 25, compounded at 6% a year for 20 years comes to $46,000. I know you go hard but I think most of us will make it to 45. At 55 it’s $100k, at 65, over $200k.
Don’t be embarrassed if you haven’t started yet and you’re old. Anthony Bourdain recently revealed he didn’t have a savings account until he was 44. He spent a ton of money on luxury vacations and weed. The rest he wasted. Now look at him. He’s rich.
The real secret to riches in this game is to keep at it. Continue to save, invest and watch your money grow. Don’t be discouraged if your stock picks are horrible and you lose money. Our competitors will give you job. You need to get invested so you can learn how to manage your emotions when it comes to money.
Remember, it’s just money. You’ve been wasting it your whole life on thirty racks of Miller High Life and books on the Venetian arts. At least by investing you’re giving yourself a chance at future.
Chime in the comments section below and let me know how you got started investing. Subscribe to the YouTube channel, Twitter @bartosiastics and come back here for all the Trending Stocks with Zacks.com, I’m Dave Bartosiak.