Everything a millennial needs before investing in the stock market
A toolbox for reaching financial freedom
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In today’s post, I’m going to be taking you through everything a millennial needs prior to investing in the stock market.
A lot of us jump into the market without any real foundation. I’m guilty of it. It’s like learning to swim without first wearing a life jacket. You’ll sink a few times but then eventually be able to keep yourself above water with trial and error.
However, sometimes it’s nice to skip the “sinking” phase. Let me show you how.
I’m about to put you on so much game…
WARNING:
This post will take you through a rabbit hole of information. I suggest you spend some time reading and soaking up everything you possibly can.
Let’s dive in.
Knowledge
One thing I regret when I started investing at 17 years old was not doing more research or learning about how investing actually worked.
I thought you just bought shares and the work ends there. I was mistaken.
Knowledge is power, as the saying goes. But it could not be more true.
A few things I wish I had learned prior to jumping into the stock market:
How to read a cash flow statement. I published an article on this and you can read it here.
The power of compounding. The first few dividend payments I received I pulled out in cash and spent it. I had no idea how powerful reinvesting your dividends could be.
What to look at when analyzing stocks. I put together a course on exactly this. Check it out here.
Economics 101. Economics is the key to understanding how the market works. Once you know that, it becomes easier to pick up on trends and figure out cause and effect. I learned economics in school, but lucky for you “YouTube University” has everything you need. Jacob Clifford makes videos that do a great job of breaking everything down in simple terms. Check him out here.
How to trade options. More specifically covered calls. Read my latest post on it here.
Even if you’ve already started investing, there are always things you don’t know yet or can improve on. Be a student for life. Never think you know everything. One piece of the right knowledge can change your life forever.
KYS
KYS - Know Your Self
Do you know how many investors don’t even know who they are and what they like?
It’s a large reason why people start to think the stock market is a scam when in reality they’re just not investing in the right things.
Think about it… If you’re risk averse, meaning you don’t like to take on a lot of risk, THEN WHY ARE YOU BUYING PENNY STOCKS?
The answers are simple:
You don’t understand the risk/reward
You don’t know yourself
That’s really all there is to it.
As cliche as it sounds, you have to look yourself in the mirror and figure out the following: