You may have looked into investing before, but been daunted by the prospect. Being an investor sounds like it is a penchant of the super-rich financiers whose entire lives are shaped around making money on the stock market. However, with online trading platforms, countless resources at your fingertips and a little more time on your hands than usual during lockdown, there has never been a better time to explore how investing could supplement your income. Investing as a beginner is scary stuff, but with the right guidance, you can invest in low-risk industries and securely build up your knowledge and skills as you go along.
Want to know more? Here is how to invest as a beginner.
Choose the type of investments you want to make
If you have never invested in any way before, you might be overwhelmed by choice. There are many ways to invest your money; let’s take a look at some of the most popular investment avenues explored by beginners.
- Trading. One of the most popular investment strategies is to trade. Using online trading platforms, many people supplement their income very successfully simply by spotting trends in market values and buying, then subsequently selling, at the right time.
- Property investments, such as buy-to-let. Buy-to-let investments are more long term than trading, but they can provide you with a steady second income from rental payments. These investments require a much larger downpayment than a trading investment, though, which many find difficult.
- Investing in a business. Another way to invest would be to buy up or buy part of a business in order to improve and expand it, thereby recouping your money when the business succeeds, and reaping rewards as a part or full owner. This could be in the Food Industry, property, retail or a wide range of different types of business investments.
Seek professional advice
If you are looking into investing but have never done it, seek wisdom from an expert. This could be a financial adviser, a friend or relative who has invested in the past, or even attending lectures or courses on strategic investment. This is an essential step to making sure your investments are not high-risk or bound for failure.
If you are interested in investing but are worried about losing money, make sure you start small. If you go down the trading route, you should begin by using a trading platform simulator that will help you buy and sell imaginary shares, allowing you to get used to trading without losing any cash. This kind of preparation and research is absolutely essential before you start throwing your real money into the mix.
Similarly, if you are looking at buying a property to let, or perhaps to refurbish and re-sell at a higher value, start with one property and work your way up. Many landlords own multiple properties within one apartment building or one city, but in order to achieve this, you should work slowly towards it, as opposed to diving in the deep end!
Overall, investing can be an awesome way to supplement income and learn about the world of finance. Use this guide to help you get started.