Maybe you have spent most of your years after college paying down student loan debt, acquiring a mortgage and having children. There wasn’t much money left at the end of the month. Now, however, you and your spouse, if you have one, are in a more comfortable position and are ready to begin investing. The problem? You don’t know anything about investing because you have been so busy paying down debt. Sound familiar? If this is your experience, there are plenty of places you can go to learn about investing.
Read investing publications. Barron’s is an excellent place to start. The terms and language of investing may not initially make sense to you, but as you become more familiar with the terminology, you will begin to understand. If you are still struggling, you may want to learn the basics through a publication like Investing for Dummies.
Read investing websites and blogs. The more you can submerse yourself in the world of investing, the quicker you will likely catch on. The Motley Fool has an excellent section on investing, especially for beginners. Mike’s recent post, 50 Personal Finance Blogs You Had Better Be Reading, features several excellent investing blogs to follow. Learn from these bloggers and respect their investing opinions, but don’t make the mistake of following them blindly.
Take free investing classes online. Morningstar offers several online investing courses that you can audit or take for free. For instance, their stocks curriculum offers 5 different levels of learning, with five to eight lessons in each level. In addition to a stocks curriculum, Morningstar also has a Funds Curriculum, Bonds Curriculum, and a Portfolio Curriculum. Each curriculum offers 5 levels.
Read about great investors. Learn about great investors such as Warren Buffett and Philip Fisher. Learn their principles and philosophies, not so you can replicate them, but so that you understand why they invest the way they do and how they became great investors.
Try out your newfound skills. A program like Kapitall allows you to create a mock portfolio for free and practice your investing skills before you put any money on the line. Take time to explore this program and see how you do with your investing. There will be time to invest your money; now is the time to practice and improve your skills.
Practice what you have learned. Once you feel confident in your knowledge, it is time to invest. Start slowly with money that you are willing to lose. As you watch your stock’s performance and gain more confidence, consider investing more.
Of course, living on less than you make is always a good rule to follow, as is avoiding lifestyle inflation. Earning a good income will also help you get ahead financially. But to truly grow your wealth, you must learn how to invest. The earlier you learn, the better because you will allow your money more time to multiply and grow. Once you take the time to learn, you will likely discover that investing is not nearly as mysterious as you thought.