When I let my mom know that I was opening brokerage accounts for my niece and nephew, her response was “Don’t you lose all your money in the stock market?”. That is typically the response you get from the uninitiated. I think people relate the stock market to frenzied day traders who are yelling, screaming, and sweating. I remember growing up and watching movies (i.e. “Trading Places”) where traders were furiously waving pink slips and yelling at one another. It seemed intimidating.
Nowadays, the stock market that we invest in is different. The reasons are also different. As a young investor, I adopted the “Buy and Hold” approach. This means when I buy something, I plan to hold it long term. I am not trying to get rich overnight, or even in 20 years. I just want my money to grow at a rate that will allow my children to have more opportunities.
There are tons of ways to invest in the stock market. The simplest and safest way is investing in electronic traded funds or ETFs. ETFs are comprised of a basket of individual companies. For example, if there was a fast-food ETF, it would be comprised of McDonald’s, Burger King, Jack in the Box, etc. This is important because if McDonald’s were to go bankrupt, you will still have other restaurants making you money. Then another company would be added in place of McDonald’s. ETFs don’t grow as fast as a lot of individual stocks, i.e. Amazon. However, it is extremely hard to pick the next Amazon. That is why ETFs are a lot safer than picking individual stocks.
To get started, I recommend using your Cash App to invest in the stock market. It has many ETFs that you can invest for as little as $1 in. I recommend picking an S&P 500 ETF and putting $1 a week into it. You will start to get the hang of it from there. It is truly how you build a brighter future for you and your family. Happy investing!
Disclosure: I am not a financial advisor or money manager, and any knowledge is given as guidance and not direct actionable investment advice. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it. I have no business relationship with any company whose stock is mentioned in this article.
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