If you have never made an investment before then it can be hard to make to know where to start.
We all know that investing can be a smart way to build your money over a short and long period of time.
However, it can also be risky depending on what you are doing.
If you don’t know what you are doing it can be difficult as you can easily throw money all over the place.
I didn’t start investing my money until a few years ago but in this post, I am going to aim to go over what exactly investing is and how to do it if you are new.
What Is Investing?
The definition of investing is to put money in a scheme, program, product. This is an investment as you are hoping to then make a profit over time.
As you are putting your money on the line to try and gain more in the long term it is essentially gambling.
And while I don’t recommend gambling at casinos and putting bets on the sport it can be worth putting a little bit of spare change in something.
Now if you are new to investing you may have heard the word stocks and shares go around. I always remember my parents mentioning these types of investments when I was younger without really understanding.
But in today’s age, you can put your money into all kinds of things as there are more opportunities available.
How Much Should I Invest?
For any beginner one of the first questions you may ask is how much should I invest.
Now while no one can tell you how much to invest it all depends on your financial status and what you are comfortable investing.
There are a number of factors, this also includes how familiar you are with investing.
There are many people making lots of money investing for e.g people who trade stocks have the potential to make thousands a day.
But with that type you need to know exactly what you are doing, if not you could lose big time.
Moving back it depends on your situation, now since this post is for newbies I would say only invest what you are comfortable with losing.
Remember investing is gambling and you aren’t guaranteed to make any profit.
With that said let’s crack on with some of the ways, you can start investing as a beginner.
1. MoneyBox App
MoneyBox is a site I reviewed a number of months ago that offers an opportunity for people to round up their purchases and invest them in stocks.
If you are from the UK and have seen their advert on TV you will already have a brief idea.
But what it is is for every purchase you make you can round it off to the nearest pound.
So let’s say you buy something for £0.90 you could round it to £1 and invest that 10p into tracker funds.
If you have no idea how stocks work then this may be for you to get you started.
The investing is all done for you, there is the option however to choose how much you want to risk.
There are Cautious, Balanced, and Adventurous options.
Obviously the higher you choose the more the risk and potential of a bigger return on investment.
There are a number of opportunities to start trading stocks but from looking at what’s out there this app presents one of the best ways for newbies.
If you want to learn more about them then check out this MoneyBox app review here.
While this one is for the UK if you are from the US you could check out Acorns, which is very similar.
Alongside this one, you will find many other apps that help you invest.
2. Flipping/Building Websites
While you can create your own business and make money what a lot of people do is buy websites and then flip them for profit.
You don’t need to be an expert in websites, as long as you know the basics, this is doing simple stuff like SEO, linking, writing posts, and content.
Then you can set up a business in making websites and then selling them for passive income each month.
This is what is great about creating websites, is it is a virtual property of yours which unlike real estate doesn’t require as much money to invest.
If you start your own website, you can start one for around $10, depending on the domain you choose.
You can also get started by clicking here.
But while that is the non-investment way you can invest in domains/websites out on the market with the intent of flipping them.
If you see a website making ‘x’ amount you could purchase it, build it so its bringing more monthly revenue, and sell it for profit.
But while that is an option,
There are a lot of opportunities when it comes to flipping sites which is why more people are becoming interested in it.
The fact you don’t have to always spend hundreds of thousands like you would need to to buy a house is one drawing factor.
3. Putting Money Away
There’s not a way to invest money that is move proven to work then going back to basics and putting money to the side.
If you have a consistent income coming in you can put a few dollars of that away each week.
So let’s say you earn $250 a week, depending on the bills you have to pay you could put $10-$20 to one side each week and let that build up.
That is, of course, an example of an amount however the point is that saving money every week no matter the amount will add up in the long run.
If we use that example to work out your annual savings you could be saving/investing $1000+ a year.
Now I know some of you may be like well what happens if after I have paid for everything I have no money left.
Well, what you can do is look at what you are paying for and where you need to work out what is a necessity.
In my case, I have stopped a lot of streaming service subscriptions.
I found myself watching too many movies on Netflix and far too much football on Amazon Prime.
Now while binging the odd series is great, I found I was better off saving that money as I realized I didn’t really need them.
So if you are paying for a service, which could be something that you may even have forgotten you pay for, well it could be worth giving it the cut.
4. Saving Account
One of the easiest ways for a beginner to invest is to open a savings account.
There are no complicated instructions involved here, all you need to do is open up a savings account and deposit the amount you want to invest.
The way it works is that when you put money into one of these accounts you will then start earning interest on the amount of money you put in.
So the banks are essentially rewarding you for using them as a place to keep your money.
As easy it is to get interested in banks there are still things you need to know.
First of is the interest rate, this can be anywhere from 0.01% to 1%.
The higher the number the better return on investment you will get.
But as you can with such as low number the amount you can expect back will be fairly low.
Let’s say you deposit $10,000 dollars into a bank with a 0.5% interest rate over a year.
After 12 months you will have $10,050.
As you can see that’s an easy $50 profit however it is a very low return considering the amount you initially put in.
The other factors you will need to consider are the bank’s terms of conditions, this includes whether you can withdraw at any time, access those funds, etc.
But to end on if you are a beginner and don’t want to put your money at risk to invest then a savings account may be your safest bet.
If this is for you I would also suggest researching different banks as some do special offers with their rates.
There Is Always A Way To Invest
You have above a few ways to invest and also an introduction to investing.
There are many other ways of investing I could have gone over, but since this is for beginners this will get you started without needing to put your money at risk.
Of course, you could trade stocks, buy shares, and so on, but those ways I don’t recommend to newbies as you can lose a lot.
The thing is in mine and your daily life there are existing ways to start saving for the future which you can start implementing.
The sooner you start the more prepared you will be months and even years down the line.