By Ida’s Ideas
Shoes Shares are on sale! Before you nod off to sleep, bare with me for a moment!
It’s difficult to ignore all the bad news out there. The Global Financial Crisis and now the Euro Crisis, pessimists predict the economy will be down the toilet for the next few years.
Despite all the doom and gloom, if you’re a young person and care about growing your savings, we are in a great position to buy shares on the cheap.
With time on our side, we can watch our investments grow over the long term without worrying too much about the short term market ups and downs.
Remember the Global Financial Crisis in 2007 and the world was in a general state of panic?
Whilst investors were running around like headless chooks, I remember thinking “Wow. Shares are suddenly affordable now… but I’m broke.”
Then in August 2011, the share market took another massive dive. As the saying goes, where there is chaos there’s also opportunity, so I decided to finally take the plunge and put together some money to buy shares.
How I started.
Before I got to a point where I could even think about investing, I had to pay off bad debt like credit cards.
Then I saved for an emergency fund. I calculated 6-8 months of expenses and set it as a savings goal. This was an important step because I wanted to have security and peace of mind. If I didn’t have any savings I knew that I would probably stress about any money I put in the share market. Saving for an emergency fund took me about 2 years.
When the market dipped in August 2011, I decided to save $1000 to put towards shares.
Next I decided to geek out and learn as much as I could. Before I started I didn’t really know anything about shares. Here are some resources I found really useful:
http://www.barefootinvestor.com/how-to-invest-guide/
https://www.moneysmart.gov.au/investing/investing-basics?gclid=CJ_u9sueq64CFWZKpgodbEixQQ
http://www.asx.com.au/resources/shares-
Finally, I opened an online trading account with my bank and picked some reliable blue-chip companies to invest in.
Getting the attitude right: slow and steady wins the race
Some people invest for the very short term (less than 5 years) – they buy and sell as soon as the share makes a profit, or sell out of fear of losing their money.
The attitude I want to adopt is to not stress too much about the short term and just pick companies that have been around for a long time and let it grow over the next 7 – 10 years.
If you’ve always left investing in shares in the too boring, too complicated basket, you may be pleasantly surprised.
I’ve found that you only need a small amount of savings to make a start and there are so many amazing resources out there to help.
I say if you’re ready to make a start, just go for it, now’s the perfect time to put some savings in shares and watch it grow over the long term.
Ida Ng is a blog contributor for the 10thousandgirl project, and has worked in various communications and marketing roles. She learnt the hard way that her crazy spending habit was the only thing keeping her from her dreams.
