It’s Time to Make Your First Investment
The best time to plant a tree is 20 years ago, the second best time is today.
Ask anyone who’s been investing for the long term if they wish they’d started sooner and I’d be hard pressed to find someone who didn’t answer yes.
I’ve told you about the power of compound interest - if you’ve forgotten, here’s your reminder.
Despite the advice from others and the obviousness of a compound interest chart, it’s still hard to start investing.
It requires you to:
- Interrupt your day
- Navigate an unfamiliar website (or worse, talk to customer service)
- And then move your hard earned money from your “I get to spend it” account to your “I’ll thank myself later” account - which is way less fun.
That’s probably why I have friends who, five years after graduating college, haven’t set up their 401(k). They’re crazy to me, but 20% of their peers are in the same boat.. so I can’t judge too hard.
My short and sweet recommendation would be to:
- Call Fidelity, Schwab, or Vanguard
- Say you want to start regularly investing in low-cost index funds
- Have a one-hour free planning session with a licensed professional on what to invest in
- Invest a set amount monthly no matter what (start with 5% of your income and increase from there)
The end.
That’s the how.
But I believe there are three thoughts that hold people back:
1. We Don't Understand Why We Need To Invest
The trends are clear.
Incomes aka the money we work for are not growing fast enough to keep up with the expenses of life. We need to create wealth through investments that we can use to account for that gap.
Think of the money you are earning now. Will you be able to buy a house with that money? What about a car? Or college for your kids? Or major health expenses?
Few people are earning enough to confidently answer yes.
The good news?
Over time, we can put ourselves in a great spot by taking a little bit and investing it. Even if our income isn’t incredibly large.
2. Investing content online looks like a scam.
That's because it may be a scam 🙂
Nearly anything promising “fast, easy wealth” from a method that “no one is talking about” likely is not the best use of your time.
Even if those things have made people legitimate money, I can assure you they are never as easy as they seem and likely come with far more risk than most people realize.
How do you avoid a scam? Seek guidance from professionals and remember...
3 . Investing Growth Happens Slowly
“The good news is, we know how to get you rich. The bad news is, the answer is slowly”
- Scott Galloway, Podcast Host and Professor at NYU’s Stern School of Business
Investing will absolutely feel like a waste of time when you start out.
It will also feel incredibly painful if your portfolio takes a hit (as I’ve written about)
But over time, the slow and steady growth will start to compound and you will see results.
As someone who is not licensed to make investment recommendations, I am recommending you make the effort to meet with someone who is.
It will be an interruption to your day.
It will feel like a waste the first few years of doing it.
But 10 years from now, you’ll wish you started way sooner.
Here are the “Open an Account” pages to the big three firms. One less excuse for you 🙂
