I'm about to invest a huge chunk of my savings into the stock market for the first time. That's something I've been putting off. Investing is challenging, emotionally and intellectually, and I'm terrified of losing my hard-earned money.
I spent my 20s laser-focused on proving myself in my career and building my financial foundation. I'm in a good place now: I've got a $45,000 cash reserve sitting in the bank that I can invest, separate from my retirement fund, emergency savings, and wedding savings. I have no more excuses to delay building wealth.
"Knowing how to invest is more important than ever, because a lot of what you need to do to reach your financial goals like retire someday is pretty much in your hands," says Doug Boneparth, a certified financial planner and the president of Bone Fide Wealth in New York City. "Long gone are pensions and guaranteed streams of income that maybe older generations had to secure their retirement."
If you don't start investing the right way, though, I know you can lose a lot of money. "I lost north of $35,000 in the first year and a half that I started investing. I lost a lot of sleepless nights," says Ankur Chugh, founder and CFO of Allied CFO Services. He's now a successful retail investor, but early on he made mistakes, day trading and using risky investing strategies in order to get rich quick.
Afterwards, he says, "I was motivated to not only, you know, get my money back, but learn what I did wrong."
"Of course we all want to be rich, but slow and steady builds the race," says Marguerita Cheng, a CFP and the co-founder and CEO of Blue Ocean Global Wealth in Gaithersburg, Maryland. She and other financial advisors recommend that the bulk of your portfolio go towards low-cost, well-diversified assets, including index funds and ETFs. Once you've built up your core investments, if you want to put some of your money in exciting assets such as cryptocurrency or individual stocks, keep those to roughly 5%-10%.
Watch the video to find out how I got started investing in the stock market to build wealth for the long run and secure my future.
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