The United States has seen a drop in the number of people actively investing in the stock market. One Gallup poll reported that just over half of people were investing their money in stocks and bonds in 2016, one of the lowest percentages seen in recent years. It may be that young, inexperienced investors are hesitating to invest because they are unsure about where to put their money. If you are just starting out with investing, there are a few tips and strategies you can keep in mind that may lead to greater investment success.
1. Do Not Ignore Emerging Markets
While you may be new at investing, limiting yourself to American markets may cause you to miss investment opportunities that are the foreign market’s best-kept secrets. Some areas, such as Singapore and Chile, have a variety of investment markets that include Real Estate Investment Trusts and corporate bond programs. REITs include residential, commercial, and medical real estate, so you do not have to restrict yourself to one type of property.
Investing in foreign markets can be exciting, but it is important that you research the country and its investment profile before you decide to take the plunge. Learn about risk factors and find financial mentors who are experienced with investing overseas to help you make these decisions.
2. Focus on the Big Picture
Many millennials are turning away from the stock market and focusing on real estate instead. However, as a young investor, you may be better off ignoring trends and turning toward the future instead. This can be especially important when it comes to building wealth because few people get rich following the crowd or investing in what is popular.
Focusing on the future can help you create an investment plan that builds your wealth slowly but steadily. Think about where you want to be financially ten years down the road, or even twenty or thirty. An investment advisor can help you create a plan that you can stick to follow without a lot of juggling, even if the economy takes a turn. Remember, you have a lot of time to buy the things you want later in life and taking risks with trendy investments to try and acquire them now may only waste your investment dollars.
3. Balance Investing With Saving
It can be almost impossible to build wealth through investing without a sound savings plan. Just as a savings plan can support your everyday checking account, building a savings plan for your investment gains can ensure that you maintain enough of a balance to keep both healthy. There are several ways you accomplish this.
One of the simplest ways to ensure your savings grows out of any investments you make is to live at or below your means. Controlling your cash outflow by avoiding large or high-interest debts can help you pad your investment savings faster and ensure that you always have more investment capital to spend when a new opportunity comes along. Without this balance, you may find your savings account stagnating.
4. Learn From Other Successful Investors
While creating your own successful investment style can be important, there is also much to be learned from other successful investors, such as Peter Foyo, the founder and CEO of Principal Standard Group. This holding company has interests all over the world, including Mexico and Serbia. If you are considering real estate investment, taking cues from successful people, such as this CEO and groundbreaking investor, may help you feel more confident with your investment plans.
As a young and first-time investor, it may be difficult to choose where to put your money and how to get the biggest returns. However, careful planning for the future and creating a plan that focuses on both investing and building wealth can help you succeed.