Investing For Beginners: What You Need to Know

Are you thinking of investing, yet you know anything about investments? Investing can be confusing, as there are various aspects. In addition, trying to research investing can be overwhelming, especially if you are unsure of what type of investments you are looking to get into. This blog will go over the most common Canadian investments and how you should start investing.

Types of Investments

Investment Properties

The most common type of investment, which many people make, is purchasing a house or condo. Although some may not be purchasing to invest, there are simple ways to make a property an investment. One way to invest in a property is by increasing the value and re-selling. To increase the value of a house, you typically will need to do some renovations to the property or add in some unique features. By making a few adjustments to a property, you can quickly increase the value to a great degree and therefore benefit from the extra amount. A more popular way to invest in a property is by renting it out to others. Of course, you will need to decide how much to charge for rent, depending on the property, structure, and location. Excluding maintenance costs, you can expect to gain $800 to $1,000 per month. Of course, these rates can vary, so keep in mind that all rental investments will differ.

Mutual Funds

If you are new to investing, you may not have heard of mutual funds. Mutual funds is overall a group of investments in a sole fund. So these investments can include stocks or bonds. When you invest in a mutual fund, you will have a specialist who will manage your funds. Having your assets in a large group of funds increases your protection. There are a variety of different types of different funds to invest in, so speaking with a money representative is essential. They can discuss with you the exact kinds of funds they offer and what they believe may fit you best. They will analyze your financial goals and how much wealth you want to accumulate from your investment to determine this.

Stocks

This is another type of investment you may have heard of before. A stock is an amount of a company that you can buy and invest from. You can begin investing in a stock from an investing platform online or with an investor directly. As a beginner, you need to be careful about stocks. Although you can gain a significant amount from a stock, it is also straightforward to lose it if you are not careful. To benefit from stocks, you need to have an in-depth knowledge of the various stocks in your area. You also need to check daily how the stock market looks and discern what stocks you can invest in.

How Should You Invest?

Start Small

As a beginner in investing, starting small with your investments is vital. This ensures that you get an idea of how exactly it works. Once you gain more confidence and experience, you can gradually increase your investment. Sooner or later, you will realize that you have lost money on some of your assets. This is an aspect of any investment, as you lose money to gain money. Yet keep in mind that you may not want to risk amounts too high depending on your budget.

Consider Your Schedule

Investing can take as much time as you want it to. If you have a tight schedule, you may want to stick with one investment or various smaller ones. On the other hand, if you happen to have more time on your hands, you can have numerous other ones. To invest effectively, you need to ensure that you have enough time to check them every day and the daily stock market updates and predictions. Keeping up to date will ensure that you benefit the most and avoid any losses that may approach.

Know Why You Want to Invest

After examining some of the main investment types, you should examine why you want to invest? For most, it is to gain more wealth, yet you may have other reasons. Whatever it is, make sure that you have goals to establish your ultimate purpose of investing and how you plan to reach your investing goals.

Before investing, you must have a basic knowledge of investments and why you want to invest. Now that you know the main types of investments, you can consider in more depth on what you plan on investing in. If you have any questions or concerns about an investment idea, please reach out to me!

Sources

-Canada Life (2020). What Are Mutual Funds? Retrieved from https://www.canadalife.com/blog/investing-saving/what-are-mutual-funds.html

-Goldman, Andrew (2022). Best Investment Options in Canada For 2022. WealthSimple. Retrieved from https://www.wealthsimple.com/en-ca/learn/best-investmentoptions#1_automated_investing_the_one_stop_investing_strategy

-Goldman, Andrew (2022). Investing 101: Investing Basics For Beginners. WealthSimple. Retrieved from https://www.wealthsimple.com/en-ca/learn/investing-basics#things_to_consider_before_investing