The Briefing

Is investing even for me?

A few things you need to know to get started.

September 2, 2021
Reading time 2 min.

🌈 A quick taster for you:

  • You can start investing with small amounts of money.
  • Any investments should always be thought of as being long-term.
  • Don’t put all your eggs in one basket — spread your risk.

🧐 Why do I care?

When it comes to the topic of making investments, many people just roll their eyes and don’t want to deal with it! There are three reasons that we most often hear — and down below we’ve shared our thoughts on them...

🔍 What exactly is happening here?

  • "I have no idea about investing."
    Okay, but you're changing that right now — otherwise you wouldn't be reading this. So you have already taken the first step: you’re informing yourself. And, if you fancy getting a taste of the stock market without taking any risk, then sign up for a stock market game. Then you can try the whole thing out with virtual money. 
  • "It's only for people who have a lot of money."
    Not true. You can also start with smaller amounts like €25. It’s correct that for individual shares that usually won’t be worth it, because the fees you’ll pay are too high, but you can invest smaller amounts in ETFs, i.e. index funds. Have a read of our article about ETFs.
  • "I can always do that later."
    Sure, but the sooner you start, the more time you have to make your money grow. When it comes to saving and investing you can take the saying "time is money" quite literally because your money will multiply by the compound interest effect on its own: your invested capital brings interest income every year — so if you keep reinvesting this together with the initial capital, then your assets will automatically grow over the years. And the longer you do this, the more you accumulate.

🤓 What does this mean for me?

You don't have to be a professional to start investing. Here are a few tips to get you started:

  • Spread the risk
    If you invest in only one stock then your risk is higher. That’s because if the company gets into trouble or slides into insolvency — perhaps due to bad management or strong market changes — then you might make high losses. Instead, if you diversify your investment by putting money into several stocks, then you spread your risk.
  • Think long term
    Investing in stocks works better over the long term. The longer you hold your stocks, the less likely you are to make losses. Short-term price fluctuations then won’t affect you so much. This strategy is called buy and hold.
  • Only invest money that’s available for the long term
    With long-term investments you should only invest money that you can actually spare for a long period of time (up to several years!). Need a large amount of money next year for a world trip? Then you’re better off investing the money in a different way! Otherwise if your shares weaken during that time then you might get out less than you originally invested.

When it comes to investing: have the courage, and just try it out!

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