Often times when people here the word "invest" they become
frightened. It is probably one of the most misunderstood
words on the planet. As a result, many employees as well
as other individuals refuse to invest their money in anything
other than a passbook savings or money market account. That
includes those who have retirement accounts available through
So, what is stopping you from starting to invest? The following are three of the most common reasons are I found after taking a poll:
1. I don't have enough money to invest.
2. I have to pay off my bills first.
3. I have money to invest, but I am afraid.
What can you do to alleviate your fear of investing? There
are many inexpensive ways to start investing. You can open
an investment account with a broker that sells shares or
partial shares of stocks, this type of broker is usually
found online. You can open a mutual fund account with a
mutual fund company, that will allow you to start with a
small amount of money. You can start investing with your
company employee retirement plan. And finally, you will
have to shed some old baggage about investing, for example,
"I will start investing when I get my bills paid off," or "I am
afraid to invest." The main questions being, how do you shed
this baggage and allay all fears?
1. The first most common reason the poll respondents don't start investing is because they think it is too expensive. They feel a lot of money is needed to start investing in stocks or mutual funds.
There are mutual fund companies that will allow you to start
an investment account for as little as one hundred dollars,
and add as little as twenty-five dollars a month. You can
do a search for mutual funds in any internet search engine
or research them in your local library. There are many companies
that will allow you to invest in a few shares or partial shares
of stock, starting with as little as eight dollars a month, and
adding eight dollars a month to your account to purchase additional shares or partial shares. Using your company retirement account is another way to invest with ease. In most cases, you will have the option to pick among investments already chosen by your company. The money is taken out of your check, so you don't miss the funds and you receive tax advantages.
2. The second most common reason the respondents gave is that they are told to pay off bills before they start to invest.
It is a good idea to have your debt well under control
before you start to invest. The interest rates on
outstanding debts are sometimes in excess of the interest
rates on investments, coupled with compounded interest, debt
payments can be excessive. There is an easy way to invest
after you have your bills under control, that is to treat
your investment savings as "just another bill," before you
know it, you will have a significant amount of money in your
savings account, you can invest.
3. Fear was the third most common reason the respondents don't
invest. This fear can be easily conquered with education and
detailed information about investing.
Do you have plenty of money to invest, but you are simply
afraid? I think the term for that is, "fear of the unknown".
That is probably the easiest investment stop addressed in
this article. The Internet has brought learning to our
fingertips, there are thousands of websites that teach
investing from a consumers perspective. Brokerage sites and
web portals provide research with detailed information about
stocks, mutual funds and other investments to protect your
interest and your money. If you are not Internet savvy, take
a trip to your local library, the librarian will show you how to use investment research catalogs such as Value Line reports for stocks research, and Morningstar Mutual Fund Reports for
Mutual Funds research. Doing your own research will teach
you how to choose low risk, low cost investments. Investment
research will also teach you how to analyze the investments
that your advisor chooses for you.
Lois Center-Shabazz, who is the author of the award winning
book, "Let's Get Financial Savvy! From Debt-Free To
Investing With Ease" ISBN #0971979502, and the founder of
the critically acclaimed investment teaching website,