There has been a lot of talk about stocks and various other investment schemes in the last couple of years, and the pandemic was undoubtedly a major driving factor behind that surge in attention towards the field. Many people have started to open their eyes to the reality of their financial situations, and we’ve been seeing more and more folks coming to the realisation that they need to diversify their income sources as much as possible if they want to stay afloat in the current climate.
If you’ve been pondering the idea of investing in stocks yourself, it’s a great time to get started – and you should definitely not delay your decision any further. In fact, some experts are predicting that we might be in one of the best periods for beginner investors in quite a long time.
You Can’t Rely on Your Day Job on Its Own Anymore
The pandemic made it painfully obvious that limiting yourself to one source of income means leaving yourself open to potential disaster. Most people think they are pretty secure in their permanent positions, but the truth is that one significant swing of the global market is often enough to shake up that perception severely. Many companies were quick to let go of their non-essential workforce when the pandemic took over, and some never fully recovered.
With that in mind, it’s time to realise that you need to take matters into your own hands, and you need to apply some additional control to where your money is coming from. To this end, investing can be a fantastic opportunity. As long as you initially approach it with the attitude of treating it like a secondary source of income and not trying to make it your main one, you’re on the right track. And if things stabilise later on, you’re also free to explore more serious opportunities.
Good Future Prospects
The future of investing in stocks looks bright right now. A lot has happened in the market as a whole over the last year – including some controversial developments like the GameStop fiasco – but the final outcome is that the market is in a very stable position right now. Many people have started to explore what the stock market has to offer, and this has created a positive feedback loop of information and support – but more on that below.
The point is, there are many indicators pointing towards an overall stable future for those who invest in stocks right now. Of course, this heavily depends on what specific stocks you pick in the first place, but as long as you don’t treat this like a gambling game, you should still come out ahead.
The Market Is More Open Than Ever Before
And because of the above, it’s easier than ever to get started with investing. Some companies have started to readjust their strategy with regards to minor investors, and have become much more open to that side of the market. At the same time, there are lots of services that can help you get started with minimal hassle. This includes anything from advanced bank accounts to brokerages and other similar platforms, down to simple guides on how to buy stocks. Wealthsimple, for example, have a pretty detailed one that’s also simple to understand for beginners. This can make them the ideal partner for those looking to get started in the stock market.
There’s also a silver lining in all those controversial scenarios – the market is headed towards tight regulation right now, and this is going to benefit everybody in the end. Certain incidents made it clear that we need stricter control in some areas of the stock market, and it looks like some government bodies are already exploring the idea. How much more regulated the market is going to be exactly is hard to tell right now – but there are some bold predictions claiming that the future of stock trading is going to look much more different than the present, and in a way that benefits pretty much everyone.
Strong Community Support
We touched on this above, but it’s an important point to reiterate. With so many people exploring the stock market right now, there are understandably also lots who are constantly looking for information on all levels, from complete beginners to experienced traders with several years under their belts. The investing community is more active than ever, with people constantly discussing different companies, stocks, options and trading strategies.
This means that you should never feel like access to information is a barrier to your entry. Quite the opposite – as long as you’re willing to learn, there are plenty of opportunities for that right now. You just need to take a look around, figure out what exactly you want to do with the stock market, and start looking up information on that front. No matter what specific area of the investment game you’re interested in, you will never have a shortage of learning materials to go through.
It’s Not as Hard as It Seems
There’s also a general misconception that trading stocks is hard in general. That’s unrelated to the current specific situation or anything like that – some people simply believe that the market is difficult to break into, and even more difficult to remain stable in. And while that might be true in some very specific contexts, it’s definitely not the case for the average person looking to diversify their portfolio. Trading stocks has been very easy and approachable for many years already – it’s just that the pandemic put some companies in overdrive, and they’ve been working even harder to deliver their solutions to as many people as they can.
Easy to Start Out Small, But Also to Expand
Another great thing about investing in stocks, and something that’s particularly true in 2021, is that it’s something that’s both easy to get started with, but also has a serious potential for expansion. Some people make their living from stocks entirely – and some of them are doing quite nicely too. But as you can expect, it takes years and a lot of practice to get to that level. Starting off, you should be more focused on stabilising this enough to turn it into a reliable source of additional income.
But once you’ve started to understand how the market works on a more intimate level, you should definitely explore your options for doing something more with your investment. There is no shortage of opportunities for that, and while some of them require a lot of effort to set up, they can definitely be worthwhile in the long run. Talk to people, find out what your options are, and play your cards right at every step of your venture into the stock market.
Keep Up with Inflation
Not everybody considers this factor carefully enough, but it’s something you should definitely think about if you’re serious about your finances. If your annual salary raises amount to 2-3%, you’re not actually getting a raise – you’re just getting a cost-of-living adjustment to keep up with inflation. And even then, you might still want to look into diversifying your income as much as possible if you want to stay ahead of the market as a whole. This is because, if you don’t pay attention to that, you might eventually find yourself falling behind current market trends, despite not changing anything about your spending habits or income. You must always be on the lookout for opportunities to bring in more, because that’s the only sure way to stay on top of inflation and prevent it from affecting you on a personal level.
You Aren’t Locked in Permanently
Last but not least, it’s good to remember that investing in stocks is a relatively low-risk operation that you can easily put behind you if you realise it’s not moving in the right direction. Of course, this depends on how you’ve set things up initially, and you’ll want to approach the market in a more conservative manner at first if you want to keep things safe. But if you do it right, you’re going to always have a clean line to the exit, and it won’t cost you much, if anything. In the end, you can leave with the experience you’ve gathered and apply it somewhere else. The important thing is that you keep an eye on how things are moving, and avoid overstepping when you’re not confident enough in your experience and performance.
Investing in stocks is a good addition to anyone’s financial portfolio. Even if you don’t have a lot of money to put towards it right now, it’s still a good idea to explore it as an option, because the market is in a great state for newcomers. Just remember what we said above, and make sure to keep your options open at all times. Don’t invest too heavily if you’re not ready to lose all that money, and always keep an eye on the next few weeks. This is not something you want to treat on a day-to-day basis, and you should have a carefully planned approach in mind at all times.
Also Read: Retirement Planning: 16 Tips To Choose The Best Retirement Investments
