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Investing isn’t just for other people. It’s for all people—regardless of their age.
Investing in the stock market can seem overwhelming, the best thing you can do is jump in — carefully. These steps can get you on the right track.
Investing helps your money work for you. By investing, your money can keep up with inflation and it can help you get on track for financial independence.
“Investing is one way to achieve many monetary goals,” says Akeiva Ellis, CPA, CFP, and Founder of The Bemused, an online website for financial literacy. “Retirement or financial independence is one popular long term goal [or] planning for the next generation, such as children’s education expenses.”
The Sooner You Start Investing, the Better
It’s easy to put off investing for another time, especially as other bills and financial responsibilities start to pile up. But the sooner you start, the more you’ll have in the long run. The earlier you start, the more compound interest can work in your favor. That’s when your money starts making money on top of itself.
Pro Tip
Getting started with investing involves a little leg work upfront but can have immediate results. Do your homework first.
You don’t have to learn the intricate ways of the market to start investing. Many platforms nowadays handle the hard work for you.
“You can get your feet wet with micro-investing,” she says. “This means you invest small sums of money, even as low as $5. There are several investing and robo-advising platforms that work well for this type of investing.”
How To Start Investing in 5 Steps
If you’re not sure how to get started, here’s how to start in 5 steps.
1. Set a budget
How much you put towards your investments can help you decide a lot of other parts of your investment strategy, like how much you can regularly contribute to your account, where you open your account, and the securities you invest in.
“The first step and most important component in achieving any financial goals is to thoroughly understand your expenses,” says Katie Coleman, Certified Financial Planner with Ameriprise Financial, a financial planning firm. “I also think it is extremely important to be realistic about what you are trying to accomplish.”
Don’t worry about starting out small. Even if you have other major financial obligations, there are ways you can invest right now. Even $5 is good enough to get started.
“In many cases, it’s a good idea to pay off any high-interest debt before investing large sums of money,” Ellis says. “However, this does not mean that you should not or cannot start investing at all.”
2. Figure out the type of investor you are
The type of investor you are comes down to risk tolerance, how much time you want to spend managing your account, and when you plan to use the money.
“The longer your time horizon, the more risk you may be able to take over time,” Ellis says. “If you’re more of a set it and forget it type of person, you may be more inclined to invest in funds that give you exposure to multiple holdings instead of buying individual stocks, bonds, or other assets that you may need to monitor more closely.” Target date funds are good for the investor who likes the set it and forget it approach. These funds will automatically adjust your risk tolerance based on your age, and experts love them for this reason. But just because this approach means it will adjust itself, don’t forget to keep checking in on your investments and continue to invest money on a regular basis.
3. Find the right platform
The type of investor you are will determine the platform you use. Most full brokerage and robo-advisors don’t have an account minimum but keep in mind that you’ll need a few dollars to start investing. Check NextAdvisor’s list of best online brokers to get started today.
If you’re new to investing, robo-advisors are a great option. These are software-run platforms that ask you a few questions about your risk tolerance and investment time to determine the best investments for you.
4. Open an account and invest
It’s time to open your account, deposit funds, and choose your investments. Don’t worry too much about your opening deposit, but remember and try to add funds regularly to your account.
“As a beginner investor, you can start with as little or as much money as you would like,” Ellis says. “Even small amounts of money, invested at a consistent pace that works for you, can result in a sizable portfolio balance over time.”
5. Keep checking back
Like anything that needs regular maintenance, you should always check on your investment portfolio regularly. Try to set a calendar reminder to review your investments once a month, or even every quarter.
TORONTO – Canada’s main stock index was down more than 200 points in late-morning trading, weighed down by losses in the technology, base metal and energy sectors, while U.S. stock markets also fell.
The S&P/TSX composite index was down 239.24 points at 22,749.04.
In New York, the Dow Jones industrial average was down 312.36 points at 40,443.39. The S&P 500 index was down 80.94 points at 5,422.47, while the Nasdaq composite was down 380.17 points at 16,747.49.
The Canadian dollar traded for 73.80 cents US compared with 74.00 cents US on Thursday.
The October crude oil contract was down US$1.07 at US$68.08 per barrel and the October natural gas contract was up less than a penny at US$2.26 per mmBTU.
The December gold contract was down US$2.10 at US$2,541.00 an ounce and the December copper contract was down four cents at US$4.10 a pound.
This report by The Canadian Press was first published Sept. 6, 2024.
TORONTO – Canada’s main stock index was up more than 150 points in late-morning trading, helped by strength in technology, financial and energy stocks, while U.S. stock markets also pushed higher.
The S&P/TSX composite index was up 171.41 points at 23,298.39.
In New York, the Dow Jones industrial average was up 278.37 points at 41,369.79. The S&P 500 index was up 38.17 points at 5,630.35, while the Nasdaq composite was up 177.15 points at 17,733.18.
The Canadian dollar traded for 74.19 cents US compared with 74.23 cents US on Wednesday.
The October crude oil contract was up US$1.75 at US$76.27 per barrel and the October natural gas contract was up less than a penny at US$2.10 per mmBTU.
The December gold contract was up US$18.70 at US$2,556.50 an ounce and the December copper contract was down less than a penny at US$4.22 a pound.
This report by The Canadian Press was first published Aug. 29, 2024.
The crypto market has recently experienced a significant downturn, mirroring broader risk asset sell-offs. Over the past week, Bitcoin’s price dropped by 24%, reaching $53,000, while Ethereum plummeted nearly a third to $2,340. Major altcoins also suffered, with Cardano down 27.7%, Solana 36.2%, Dogecoin 34.6%, XRP 23.1%, Shiba Inu 30.1%, and BNB 25.7%.
The severe downturn in the crypto market appears to be part of a broader flight to safety, triggered by disappointing economic data. A worse-than-expected unemployment report on Friday marked the beginning of a technical recession, as defined by the Sahm Rule. This rule identifies a recession when the three-month average unemployment rate rises by at least half a percentage point from its lowest point in the past year.
Friday’s figures met this threshold, signaling an abrupt economic downshift. Consequently, investors sought safer assets, leading to declines in major stock indices: the S&P 500 dropped 2%, the Nasdaq 2.5%, and the Dow 1.5%. This trend continued into Monday with further sell-offs overseas.
The crypto market’s rapid decline raises questions about its role as either a speculative asset or a hedge against inflation and recession. Despite hopes that crypto could act as a risk hedge, the recent crash suggests it remains a speculative investment.
Since the downturn, the crypto market has seen its largest three-day sell-off in nearly a year, losing over $500 billion in market value. According to CoinGlass data, this bloodbath wiped out more than $1 billion in leveraged positions within the last 24 hours, including $365 million in Bitcoin and $348 million in Ether.
Khushboo Khullar of Lightning Ventures, speaking to Bloomberg, argued that the crypto sell-off is part of a broader liquidity panic as traders rush to cover margin calls. Khullar views this as a temporary sell-off, presenting a potential buying opportunity.
Josh Gilbert, an eToro market analyst, supports Khullar’s perspective, suggesting that the expected Federal Reserve rate cuts could benefit crypto assets. “Crypto assets have sold off, but many investors will see an opportunity. We see Federal Reserve rate cuts, which are now likely to come sharper than expected, as hugely positive for crypto assets,” Gilbert told Coindesk.
Despite the recent volatility, crypto continues to make strides toward mainstream acceptance. Notably, Morgan Stanley will allow its advisors to offer Bitcoin ETFs starting Wednesday. This follows more than half a year after the introduction of the first Bitcoin ETF. The investment bank will enable over 15,000 of its financial advisors to sell BlackRock’s IBIT and Fidelity’s FBTC. This move is seen as a significant step toward the “mainstreamization” of crypto, given the lengthy regulatory and company processes in major investment banks.
The recent crypto market downturn highlights its volatility and the broader economic concerns affecting all risk assets. While some analysts see the current situation as a temporary sell-off and a buying opportunity, others caution against the speculative nature of crypto. As the market evolves, its role as a mainstream alternative asset continues to grow, marked by increasing institutional acceptance and new investment opportunities.
