Recently, people who don’t normally think about the stock market have been intrigued after a group of non-traditional investors greatly elevated GameStop stock. However, what many don’t know is that there has actually always been a lot of potential in investing one’s time and focus into the stock market, mainly through the potential benefits you can reap from long-term trading with other companies.
For those who may not know, the process of investing is when you take stock out of a certain company or corporation, and the more stock you take out, the more money you make depending on how well that company or corporation performs.
Of course, the matter is a bit more complex than that, and while the rewards are great, so are the risks.
First off, you are required to have a certain amount of money before you begin investing in the stock market- you can’t start investing with just the money in your pocket. Second, there is a limit to how much you can invest in a company at a time, and how much you can invest in general, with both usually directly proportional to your net worth.
Another thing is that age is an important factor in determining how much is at stake if you take out a certain party in stocks, as well as an indicator of what you should and shouldn’t invest in. For example, if you’re a beginner, you should stick to the smaller companies initially, then gradually increase the power and influence of people you invest in as your knowledge and skill of the “craft” of investing also grows with time and experience. The “middle-aged adult” phase of life is when most investors take on big players to, in essence, sponsor them, making big earnings- as well as, sometimes, big losses that they at least have the sufficient time to recoup, should that happen. Conversely, the older you get, the less expensive the people you invest in should be, because if you’re investing in a big company or corporation that bottoms-up, you will too, and you’ll have little-to-no time to make up what you lost.
In addition, upkeeping stocks requires a lot of research, as well as fickle loyalty; in the investing world, you’re aiming to make all of the money you can over a long-term period, which means keeping and eye out for what will become big not just in the short-term, but what will become big in the future as well- it requires the sufficient insight to recognise trends and patterns, as well as the foresight to put that knowledge into a plan of action. You can alleviate this burden by hiring out a financial advisor who can manage your investments for you, but you need the sufficient money to do so first, and they still take out a portion of what you make as recompense. Even then, odds are you won’t be able to hire out a financial advisor for some time when you start out, so responsibility will have to fall on your shoulders when you do start, and even if or when you do get one to work with you, responsibility is still required, as you’ll often have to engage in meetings with said financial advisor regarding what would be the best course of action.
And then there’s the fact that, realistically, investing is functionally closer to gambling than it sounds. The wheel of fate turns in unexpected ways, and sometimes, making or losing big is just as reliant on utter luck as it is the blood, sweat and tears of the person investing.
However, even with all of these risks in mind, the payoff for choosing to take these risks- the potential, and (mostly, depending on your choices) reliable odds in your favor at that, towards making a ton of money- can be a payoff on its own in numerous regards. People who want to go to college and need to take out a loan can use the money that they pull from investing to pay off their debts- in fact, the money you make from stocks can be used to pay off debt in general. On a similar note, you can put the money you draw from your investments and store them into a savings account to use for the long-term, such as purchasing highly-expensive necessities (such as a car or house) or keeping on hand in order to pay expenses, such as taxes or your mortgage. Not to mention, more money generally means you can spend more on niceties and other comfort items that you don’t necessarily need but would nonetheless be fun or enjoyable to have, although again, I would like to stress the importance of the reality that it may be best to use the money you obtain from the stock market to help you fulfill the various payments you will be obligated to pay as a US citizen- again, such as taxes or the mortgage on your house.
Ultimately, the choice on whether or not to invest is yours to make. However, with this article bringing forth both the pros and cons of going into the trade of trading, I hope that you at least give the idea some decent consideration.