College is as good a time to start investing as any. Contrary to popular belief, you don’t need a ton of money in the bank to learn the basics and start seeing returns on small investments. If you want to become an investor, here are some general beginner tips that will prove useful.
1 – Know your rights
If you’re going to start investing, it’s a good idea to become familiar with the rules of this game. Or at least the simplified version of them. Learning about your rights as an investor is a good place to start, as well as learning under which circumstances you may be able to recover investment losses.
Learning about these basics will not only help you protect your savings and exercise your rights, but it will also start to ground your view of what being an investor is really like. It’s good to make sure that your mental image of investors and investment isn’t being informed solely by hearsay and Holywood.
2 – Manage your expectations
It’s important to note that the stock market is seldom a direct route into massive wealth or overnight life changes. Investment can be a great source of income, but the people who get the most out of their investments are generally the ones who invest smartly and consistently over several years. There are investment options that can lead to massive returns in a short timeframe, but these are generally riskier.
3 – Understand your investment
As mentioned, there are many ways to invest your money. Investment is more often associated with buying and trading stocks, but you can also invest in commodities, foreign currencies, bonds, startups, and more. And as a beginner, it’s wise to get familiar with the ins and outs of your chosen investment option before you invest too much into the market.
There are a few reasons why understanding the product you’re investing in can be advantageous. Knowledge about the topic can help you properly time your investment and can inform your expectations of how much you can expect in return for that investment. On top of that, understanding a product can also help you avoid scams, as bad actors often rely on misinformation to trick their marks.
4 – Keep your devices secure
Most investors today manage their assets through their personal devices, be it a computer or a cellphone. And if that’s your case, it’s also wise to get the basics on cybersecurity before you get started. Setting up two-factor authentication across your accounts and making sure your devices are free from malware can both help protect your accounts from being hacked in the future, and that’s just scratching the surface of the wealth of cybersecurity measures you can implement in order to make your devices more secure.
5 – Mind the fads
Every few years a new exciting investment option will come along, make some people rich, and gain tons of attention from the media. And while some investors can profit greatly off these trends, if you’re a beginner investor, you’re probably better off avoiding these fads. Markets like these are often more volatile than usual, which is something you won’t want to deal with until you have more experience. Most seasoned investors avoid this type of market altogether, or they invest only a small fraction of their wealth into them.