When it comes to getting into investing, many people find themselves hesitant, for a number of reasons. When asked, the number one reason people state for not wanting to invest their money is lack of knowledge.
Fortunately for these people, investing isn’t too complex to get into, and as many confident investors can tell you, it’s just a matter of getting started. Once you have tried a few investments that are good for beginners, investment knowledge begins coming quickly. There are a number of investment opportunities that are ideal for first time investors, and first timers might be surprised to learn that they are already investing and don’t even know it.
Interest bearing savings accounts are one type of investment that many people already have. These types of accounts are fairly simple – they pay a % return on the amount of money in the account, depending on the bank. As many people already have interest bearing savings accounts, a good type of investment to start out with is a certificate of deposit, or CD. Interest rates on CDs are typically higher than on savings accounts, and can be purchased at most any bank. One benefit of a CD is that you can choose the duration of the investment, and then collect interest until the CD reaches maturity. Despite the recent furore regarding the banks, they remain a safe place to put your money, but of course the paltry percentages being offered at the time of writing are often outstripped by rates of inflation. So if you reframe any savings accounts that you have as investments, they start looking like a poor choice.
Money market funds are often a good option for first time investors. These work in much the same way as interest bearing saving accounts, and have higher interest payouts. Like savings account, they are short term, and are a good alternative for first time investors who don’t want their money tied up in a CD.
Once you have tried out one or all of these types of investments, you’ll quickly realize how easy investing can be. From here, a popular option is to meet with a broker and discuss more complex investing options. As you continue learning, a good tip of advice is to maintain a low risk tolerance. A low risk tolerance simply means that the investor sticks to investment opportunities that are low risk, which is good for first time investors just getting started.
You should also realize that learning investment methods yourself is much easier than you may think and puts you in charge of your future. Try and make sure the information you’re getting comes from reliable – proven to be reliable – source. Anybody offering you investment information should have a publicly proven track record of making money from investing, and not just from writing about it!
Andy Markus is an online trader who is busy studying the methods of acclaimed trading guru Mark Shipman using his http://www.TheAutonomousMillionaire.com course.