What is the initial step to investing is a question a lot of people have these days. They know that investing in the stock market can be a great way to secure their financial future but they are just a little unsure how to go about it. To answer their question of “What is the first step to investing?” really requires a question in exchange because it is important to find out the kind of investment they mean.
We have to know which types of investment they are thinking of when they ask “what exactly is the first step to investing?” Many newcomers to the world of investments think only of stocks and shares but there are of course many more options out there. Some of which are possibly far better for beginners.
For anyone looking to get started with investing they need to consider whether they will be investing a lump sum or regular monthly payments. With monthly savings they could consider looking at mutual funds as these will enable them to get a taste for the stock market while sharing the risks and rewards with others. They can begin their portfolio with as little as $25 per month to find out if it’s one of the things that suits them.
For those who have made the decision that they would like to go for the full blooded method of buying stocks and shares directly they need to have in between $3,000 and $5,000 if they want to use a full service stock broker. There are a few brokers who will take into consideration investments of less but they will need searching for. Without a doubt there is always the option of using online brokerages which usually require only around $500 to begin with. These can be an excellent alternative for anyone who has the confidence to make their own investment choices.
Something that does need thinking of is the question of charges. This applies whichever type of broker and whatever method is used for that very first investment. Many new investors incorrectly assume that all their money will go directly into buying the investment they have chosen and neglect the fact that that there are different costs for buying and selling stocks. This can be quite a surprise to many but they should always keep in mind that even mutual funds have annual charges.
Nonetheless if they consider all these things they will soon have their answer to the question of what is the first step to investing.