Investing With Minimal Knowledge

Where Should You Start?

First off, let me say that learning the ins and outs of the stock market and investing in general, is the absolute best way to go, before you even start investing. It usually can take up to 1-3 years to learn how to invest, however, with technology and innovation, it’s becoming more simple to invest in the market. If you are one of those people who has a consistent income, and would like to earn some extra capital for the future, then investments, are the way to go.

Not to come off as a “follower”, but everyone is playing the stock market. What I mean by everyone, is the majority of institutions and corporations, including individual investors. The company you work for, that matches your 401k, invests in the stock market, with your money. Your insurance company, uses a percentage of your premiums to invest in the market. Your Alma Mater, invests in the stock market. Harvard University, being the top college with over $36 Billion in endowments.

For hundreds of years, people have made and lost money as well, in stocks. This article is written, for those of you who have heard the horror stories about the stock market, and would still like to try your luck, but don’t exactly know how. You have to know, there is ALWAYS a risk in investing in anything. So keep that in mind when you start to look into the market.

How Much Money Do You Need?

Let me also say this, it doesn’t take $2,000-$5,000 to start investing in stocks. Granted, if you have that much to put in the stock market, then that’s actually a great starting point, you have access to a few thousands, which would possibly equal to bigger returns. For those of you in the $25-$500 range, there is a starting point for you as well. Let’s say, you bring home anywhere from $500-$800 a week, or bi-weekly. Calculate your bills and how much of debt you have to pay on every month, (under 5% is manageable). If you can save $25-$50 a week, then invest that small amount into a stock of your choice every week. Now you may be thinking, where would you buy the stock? This is where, innovation comes into play. Apps like:

  • Acorn Investing
  • Stash Investing
  • Swell Investing

You can start with one of these investing apps first. For example, I have all three apps, but I use Stash more often. I started off at first, by investing $15 in their “Corporate Cannabis” portfolio. I also set up an automatic $20 a week transfer from my bank account to my portfolio. So every week, I would get a notification, that $20 was successfully transferred into my Stash Account, and I can stop the weekly transfer at any given time, with no fallout, and resume at any point and time, whenever I feel.

Now the price of the Exchange Traded Fund(ETF) that I purchased, is $53.68. So my initial $15 investment, only acquired me 0.27942 shares in the company, which, if I only left the $15 in, I would never see any real return at all. So that’s why you should set up the automatic weekly transfer to continue to build up enough, to acquire at least your first 10 stocks in whatever portfolio you decide to choose. You can start with a minimum of $5 dollars a week, if need be and then continue to go from there. It’s works pretty much the same with the other two apps as well. You can even choose what type of risk you’re willing to take with your investment, either risky, moderate or aggressive.

What Stocks Should I Pick?

Honestly, research is the key to finding a legit company to invest in. Most people who are new to the market, flock mostly to the mainstream stock, which isn’t bad, but everyone doesn’t have $1,400 to buy ONE share of Amazon stock or $176 for ONE share of FB. You have to remember, in order to see a return, you have to buy stock in bulk. The ideal number is 100, so for an example, if you buy a 100 shares of stock in Amazon at $1,400 a share, then that would equal to a total of $140,000, not including commission fees! The same for FB, a 100 shares at $176 is roughly, $17,600, plus commission. So when you think about the “Average Joe”, then “mainstream” stocks may not be the way to go, at least not at first. For new comers to the market, I suggest investing in, with proper research of course:

  1. Dividend Paying Stocks
  2. Defense/Utility Stocks
  3. Real-Estate Investment Trusts
  4. Mutual Funds
  5. Exchange Traded Funds

How To Research Stock Options?

Like I stated before, research is the key to understanding the market and the company you are looking to invest in. Most people get their news from FB and mainstream media, which is fine, but there are tons of other avenues you can take, to acquire information. Here are some mainstream sites you can start of first with, by downloading or following their platforms:

  • CNN
  • Yahoo Finance
  • MSN Money
  • Bloomberg
  • Investor’s Business Daily
  • Nasdaq
  • Wall Street Journal

You should also sign up for free newsletters, that you would receive by email, and set up alert notifications to receive throughout the day, to keep you informed. The more you research, the more you find other channels of information, and possibly before anyone else. When you start to get a feel and understanding of the market, then you can move to opening a brokerage account. Ones such as:

  • TD Ameritrade
  • E-Trade
  • Innovative Brokers
  • Fidelity

I personally use Fidelity more often, which they all pretty much work the same, they just differ in commission you have to pay for each trade you make. Fidelity, gives you the option of opening a cash account as well. Basically, it’s like having a regular bank issued debit card. The difference is, I can use it to make purchases and pay bills, and at the same time, log in to invest a portion of my finances into the stock market when I get ready. The money that I have sitting and not touching, is automatically re-invested In a Money Market Savings Account(not taken from you, but re-invested, your money will still show), and gains interest as it sits,(higher than the interest payed with a bank). Reason being, is that Fidelity operates as a “Money Market Account”. Which most, are designed like. So think about that, you just paid your bills, and decided to log in on your phone or PC and purchase a few stocks as well, and then sit the rest to the side, so it can gain interest over time, along with having a unique debit card in your pocket. Imagine gaining a 150% on your return, and it comes directly to your debit card, for you to spend.

For those of you contemplating investing, take these baby steps at first, before you decide to dump a huge portion of your capital into the market. The market isn’t going anywhere, so take the necessary time to do the homework. I hope this helps. Be on the lookout for more upcoming investment options. 

Please leave a comment below and continue to follow MillennialXeConomics.com for more info or email me at david@millennialxeconomics.com

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David Chandler

  1. Jordan left a comment on August 28, 2018 at 3:55 am

    Thank you for this great advice! It encourages me a lot because I’m such a newbie.

    I had some combo of beginner’s luck and research payoff with some penny stocks this year, returning 65% and 26% respectively, but I haven’t dabbled much since for fear of breaking my. Streak.

    I’m really curious about dividend paying stocks and online real estate investing. Do you have any in depth posts on how those work?

    • admin left a comment on January 17, 2019 at 11:09 pm

      I’m working on more articles right now Jordan.

  2. Jody left a comment on September 22, 2018 at 4:31 pm

    Great information you have presented regarding investing in stock. I invested a little when I was younger but never got into it much as I never saw any major returns.

    I like your idea to set aside a small set of money from each paycheck to go towards investing in stocks of our choosing.

    I was unaware we could obtain “debt cards” from companies like Fidelity to use to pay bills, make purchases and at the same time log into our account and invest in the stock market. Thank you for that information!

    Are the media outlets you highlighted novice friendly? I feel I need a source that is not into too much jargon but instead speaks to the “average joe”. Can you recommend some?

    Thanks and have a great day!

    • admin left a comment on January 17, 2019 at 11:04 pm

      Sorry for the delayed response. I would recommend either one of the outlets I wrote about. I have confidence in them all, without any bias opinions. At the end of the day, it’s all about preference. The safety net is knowing that regardless of which one you choose, it will be of quality.

  3. Lok Which left a comment on January 17, 2019 at 11:25 pm

    Thanks for sharing this informative and educative post. This really came at the right time of my life because I have decided that the next business step I want to take is going into stock trading, investing. Reading this has really informed and educated me on how I should get started. I must appreciate you for bringing this post to me it has gone a long way as I now know the next step to take.

    • admin left a comment on January 19, 2019 at 5:01 pm

      Contact & network with me anytime Lok. Glad I can help

  4. Daniel left a comment on January 17, 2019 at 11:26 pm

    Thank you for sharing such great information David. I always wanted to invest in the market but honestly, I was afraid of loss. It is great that you mention a range of $25-$500 because I was thinking that I can only invest big amounts of money. I will think once again about investment as it is definitely something that can change human life.

    • admin left a comment on January 19, 2019 at 4:59 pm

      Indeed, Daniel. It can & will.

  5. Shubhangi left a comment on January 17, 2019 at 11:44 pm

    Hey David,

    You are absolutely right when you advise learning in and out of the stock market and companies before making any investment in it.  

    Also, I had the belief that you need a large sum to invest in the stock market, so really interesting to know that you can invest in the stock market with as low as $ 25 or 50.

    Thanks for providing information about apps, and debt cards.

    Regards

    • admin left a comment on January 19, 2019 at 4:59 pm

      No problem.

  6. Ed left a comment on January 18, 2019 at 2:00 am

    Great advice. Wish I had this kind of information and resources available back in the day when I was into investing in stocks. Not that I lost money, but didn’t gain any either. So I left it up to experts and put money into mutual funds and more conservative investments.

    Now that I’m retired is there a way to invest in stocks that would be good for me? Or should I stick to withdrawing my retirement funds until they are gone?

    Thanks,

    Ed

    • admin left a comment on January 19, 2019 at 4:58 pm

      You can do both Ed. Your retirement fund basically does the same thing. Invest in the market with your money and pays out the earnings to you. You could do the exact same thing yourself if you tried.

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