A Complete Guide to All You Need to Know Before Investing

Let’s face it, diving into any new business, and taking a financial turn can be difficult.
How about you cut the investment from the list?
Investment doesn’t have to be complicated!
For sure, it is a new idea and might be a scary thing to opt for, but with some knowledge and affirmations, it can be a fun trip ahead.
You don’t have to be a complete genius to get into investing. Consider a few simple steps before you start investing.
We have some of the most vital things you need to know before investing, coming straight from successful investors.
With adequate knowledge and awareness, Investing could be very convenient and fun for you.

When faced with inevitable financial conflicts, starting a new business could be quite expensive.
For a few lucky ones who have cash on their hands, they could roll into any economic circumstance to acquire stability.
However, not everyone is lucky!
You still can grow your money without getting into much trouble.
An Investment could be your happy choice here.
An investment could prove to be a very reliable and beneficial option for your current business situation. It will also be a helping hand for you to grow your money in a few simple ways. Though, nothing is ever fruitful when done blindly.
If you have decided to start investing and are immediately looking out for ways to throw your money on stocks and bonds then hang on. There is one most important thing left for you to do.
Before you went into the thrilling ride in the investment world and wonder how to start investing, there are a few techniques you need to know and consider. How can you cook a tasty meal without knowing its ingredients?
There is no need to panic about scary terms like “stocks”, “Profit” and “loss”!
If you are a newcomer to the world of investment, then welcome abroad as we guide you with a few final ingredients and factors to consider when making investment decisions.
Let’s swim through them, shall we?

1. Map Out Your Financial Route

Before making any vital decision regarding your business, whether it is an investment or not, you need to know your direction.
Don’t just go out and play your money without appropriate information. Sit down calmly and map out your financial route. Ponder over where you’re standing right now and where your financial situation is heading to.
This criterion is not just for beginners; any smart investor would consider it.
You need to map out your monthly income, isolate your expenses, and figure out your vital priorities.
After putting aside the debts, expenses and savings look at how much is it left for you to invest safely.
The great thing about investing is, it doesn’t demand you to bring a bag full of cash.
All it takes is a little amount of money to start new. You can always go for stock markets with little cash.
Mapping out your financial status is the utmost ingredient for your investment meal. If not convenient alone, you can always seek professional help and reach out to your family.
Robo Advisors are also available for your help anytime.
These are the class of advisers to provide you with financial advice and investment management online.
With this platform, you can seek friendly advice with a moderate to minimal human interaction.
Hence, if you have no idea how to start investing, you need to reach out to them.
The more you are aware of your financial status, the better you will be able to invest.

2. Be Aware of Risks

We all get excited about new and innovative ideas.
The anxious thoughts keep us up all night, and we cannot wait to try the new motivation we have got. However, investment is not some game or an outfit you can try on without any risk.
First-time investment ideas could be pretty confusing and scary.
The industrial world out there is full of risks and hardships. Any minor mishap can prove to be very critical for you. Hence you need to be aware of the risks you might encounter along the way and prepare your mind accordingly.
The first and utmost thing you need to know is that the investment vehicles are volatile.
You cannot guarantee success if you are investing either in stocks or real estate—the market price and value of every asset decease and increases over time.
You might have purchased a particular stock, and with time its value goes down. If that happens, don’t panic.
Stay patient and be aware of the fact that these assets are unstable. You might encounter loss at a particular time, but you will gain profit back again.
It can’t be promised that your investment will provide you with money always.
High possibilities are that you might invest in assets that could result in a loss but again don’t panic. Always dive in with an intelligent plan and invest in vast aspects. Never rely on one!
Nothing is without risk, and the same goes for investment. But once you are aware of the risks, you can plan accordingly and invest better.
The reward for taking risks is the possibility that you might receive greater investment returns.
If you have long-term financial goals, then you are more likely to invest cautiously in assets involving more significant risks like stock and bonds and grow your money accordingly.
Investment is not about avoiding risk. It is about managing risk.
As Routh encourages his new investors by implying,
“Risk and return are married, and they are never going to get divorced. There is no return without a risk”.

3. Get into Rewarding Vehicles

For a successful investment, the choice for your vehicles is of supreme importance.
Several opportunities are sitting in the market waiting to be worked upon.
However, not every option you choose will benefit you.
Before rolling into the whole investment process, you must be cautious and aware of the investment options for you.
Always get into the vehicle that would provide you with maximum benefit.
The drive might be slow, but it needs to be steady and in the right direction.
When you search “Investment options” in your Google bar, it will pop out for you never-ending lists of links each stating a different statement.
Don’t get confused!
We have got numerous investment vehicles for you to get in.
You can put your money in many significant assets like stocks, bonds, physical commodities, and real estate. But you must always be sure about the profit you will get.
Of course, no asset is stable, it will decrease and increase over-time, but with proper analysis, you can always choose the option that will provide you with maximum benefit.
For instance, investing in real estate is a good option as the market price of properties mostly increases with time.
You should follow the lead-in of an intelligent investor.
Purchase an asset or invest in it when it is facing a downturn in the market. Utilize the opportunity in your favour. Buy it at a lesser price and sell it when it is back up again.
With this masterpiece guide investing for beginners will be a piece of cake.
Stock Market is yet another compelling option to consider, but you should do thorough research before getting into one. It is like a seesaw. The market that offers one asset value to do well might cause another category to give poor results.
The smart thing you need to do is to diversify your investment.
Think outside the box and invest in more vehicles than just one, the more, the better.

4. Keep an Eye on Fraud

Scam companies hit the headlines too!
It is among the most critical factors you need to consider when making investment decisions.
Often, these fraud companies will use highly recognized headlines to lure innocent investors and make their basket sound more legitimate. Always be cautious about fraud.
There are specific questions you need to ask yourself and the companies to calculate an unbiased result.
Before you invest, see through the business details and portfolios of that company to keep you safe from frauds and scams in times ahead.
Be careful about verbal promises and guarantees of returns but also insist on the written confirmation.

5. Have an Appetite for Goals

One of the ingredients to note for investment is to have an appetite for goals.
To know your financial goals for the present and future times ahead is essential before you bounce your cash into the baskets of investment.
Ask yourself questions like,
Am I looking to protect my money or grow it?
Is it my long-term goal or a short-term?
Am I heading to be an Active investor or Passive?
How do I foresee my future?
What are my first-time investment ideas, and how can I make then unique?
After answering these questions, set some financial goals, you will feel more confident to invest.
A tip for you; never settle for less. Have as many goals as you can. Even when your plate is full have an appetite for more and diligently strive for them.
Never settle for less!

6. Try on Free Association Technique

Last but not least, any financial dealing is a stressful event to encounter.
The unpredictability along could be a cause of everyday anxiety, nail-biting, head-scratching stress.
You must know that investment is not a very stable route for you to walk on. It has its bumps and hardships, which could be pretty stressful.
But there is a way not to let stress get to you.
It is a possibility that a down-fall in market price or no success out of your investment could leave you with stretched muscles and frustrating thoughts. Hence, we bring you a great technique to lose that.
Free Association technique is a much recommended and widely used by Psychologists to help their clients out of tense situations. You can perform it on your own.
Turn off the lights of your room, lock the door and lie straight on your sofa. Wait until the tranquillity consumes you for you to let the stressful thoughts out.
It’s a favour you will do to yourself because only with a clear mind you can make wise decisions.
Check out our website for more guidance.

The Crux

Making an investment decision is scary, but with these beneficial tips, you will be able to invest in a much smarter way.
You must always have enough information regarding your new motive before diving into one. Also, see what famous people like Warren Buffet has to say about successful investing.
Follow these significant steps and wait until the success knocks on your doors.

author

ABOUT THE AUTHOR

Jun Sing Tan

I help young adults and working professionals achieve their financial goals with a full suite of risk management and wealth accumulation solutions. I firmly believe that financial education should be easy and achievable for all. I am committed to service and hope to be your one stop financial solution.

author

Jun Sing Tan

November 18, 2020

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