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How To Invest In Stocks And Make Money

How To Invest In Stocks And Make Money

How To Invest In Stocks And Make Money

Introduction.

The only kind of education that the traditional school system does not provide is financial education. Only a few people are lucky to come across this kind of education, and they do so in an informal way.

The traditional school system is so against getting financial education that it has raised hopes for so many people and in the long run disappoints them.

There are many people with various levels of educational degrees but are not doing well financially, most of them even work as twice as hard as anyone on the face of the earth but they never made it out successful, the majority even die broke.

Meanwhile, on the other hand, there are so few other people who dissed the education provided by the traditional school system and embraced financial education, majority of these people are the ones that you find on top, the majority are even captains of industries.

When you look at the present Forbes list, all those people that you see listed are people who at one point in life embraced financial education, mind you they did not get it from school, remember, the school system hates people with financial education.

All that the school ever prepare its victims for is a life of mediocrity, and averageness, the motto is simple;

Get a degree and find a job and save for retirement.

If you are presently in this trap, I suggest you find a way out, because that path is very ugly and does not pay in the long run.

It used to, during the industrial age, but now in the information age, where computers are replacing the inefficiency of man, I suggest you have a rethink.
You should find a way of avoiding the rat race at all possible cost. Life is not fair to anyone, you have the sole responsibility of making life fair to you, and in most cases, getting a good job does not guarantee that life will be fair to you because all you will ever do is to live your life for someone else.

My Personal Experience.

I was young, when life came in hard on me, while growing up, I understood what it meant not to have enough money, all I ever did was desire the best dress, game console, best car, a fine house, vacation, but I never got it, till I changed my thinking pattern, this has helped me a whole lot, and I recommend you do the same.

I was a high-school teacher, when I came across a book that changed my mind and that book was called “Rich Dad, Poor Dad” By Rober Kiyosaki.

To be honest, readers are leader, and fact remains that, there is no mountain anywhere, the only mountain in your life is your ignorance.

In that book, Robert Kiyosaki took time to explain, the rudiments behind getting a basic income and that stuck in my head till today.

He pointed out the four income quadrant of every person on earth.

E – Employee
S – Self-employed
B – Business
I – Investment

Just to buttress on these income quadrants.

1. An employee is someone who works for someone, with all hopes of getting paid for labour at the end of a certain time.

If such a person stops becoming an employee, such an income flow is stopped.

2. A self-employed is someone who has acquired certain skills and is knowledgeable enough to monetize them, such people include Artisians and skilled people.

Such a person in this income quadrant makes money only when he can sell his/her service to a third party.
If such an individual stops selling off his money services, then the income flow is stopped.

3. A Business owner on the other hand is someone who has built a business up to the extent that he can employ and pay over 500 employees.
Most people are quick to call themselves business owners when the number of their staff is restricted to only them.

4. An investment is an income stream that works for you whether you are there or not there.

You don’t need to own huge staffing, a business idea or a Land to create an investment, all that put to use is your money.

In this income quadrant, all that works for you is your money. Now, I know that you are surprised, in this article we are going to be talking more about how an investment works.

Most times, you don’t need to have an idea, or a skill, knowing how to make your money work for you makes you a good investor.

There are various ways to make your money work for you, some have proposed cryptocurrencies, but in this article, I am going to show you how to invest in stocks.

Why You Should Invest In Stocks.

Stock prices fluctuate throughout the day, but investors who own stock hope that over time, the stock will increase in value.  Not every company or stock does so, however. Companies can lose value or go out of business completely. When that happens, stock investors may lose all or part of their investment.

This is more reason why investors need to do thorough research about the companies that they intend to invest in and also a wise act to spread their money around, buying stock in many different companies rather than focusing on just one.

Stocks carry more risk than some other investments, but also have the potential to reap higher rewards. Stock investors earn money in two main ways:

1. Hold and Sell Method – If the price of a stock goes up during the time they own it, and they sell it for more than they paid for it.

2. Through dividend – Dividend is created to allow you receive regular payments from a particular stock or more. Not all stocks pay dividends, but those that do typically do so quarterly.

1. Invest in Stocks to Grow Your Money.

While starting a business might not be an easy way to grow your money you can as well invest in stocks and begin growing your money right away.

Investing in stocks can help you grow your money by over %10 in a long run.

The Bottom line through regular investing, you can turn $10,000 per year into more than a million dollars over 30 years.

Now, $300,000 of that million dollars is the money you directly invested each year. But the other $710,730 is money you made from investing in stocks.

The important point is that investing in the stock market can make your money grow much larger over time. And this remains the number one reason people invest in stocks.

2. Invest in Stocks Because Money Sitting in the bank Will Lose Its Value over time.

Inflation is one of the enemies of currencies all over the world causing them to decline drastically each year.

Think of inflation as the slow but steady force that makes things cost more over time.

Back in the days in a country like Nigeria, the cost of travelling overseas from Nigeria was less than N70, but with bad government policies that were created to kill businesses, inflation went up and brought down the economy, causing the cost of goods and services to go up which in turn manifested in form of currency devaluation.

What that means for you is that your hard-earned money is slowly losing its value over time.

For example, if you save $10,000 this year and put it under your piggy bank for the next 30 years, it won’t be $10,000 when you take it back out, it would have devalued.

The fact remains that, when you have dormant cash sitting in a bank waiting to be put to use in future, then such an amount of money would be devalued.

Since the year 2000, the annual inflation rate has mostly been between 1% — 4%. That means every year your money’s buying power erodes by 1% — 4%.
Investing in stocks can help the value of your money escape inflation and appreciate over time.

3. Investing In Stocks Helps You To Grow your Investment.

With the evolution of the stock market, building a brick and mortar business has become obsolete. You don’t longer need to have a business idea or even think about starting your own business before you begin to make money.

Stocks have earned more wealth for investors than most other investment options. On average, investors in the U.S. and all over the world. have profited more from buying stocks than any investment initiative.
I am not asking you to throw all your savings into buying stocks at once, without proper education, because if you do that are possibilities that you are going to lose money.
owning a stock does not replace starting your business if you do have the idea.

4. Investing In Stocks Is One Of The Easiest Thing To Do.

All you need to get started with stock is a working knowledge of how the stock market works and a valid stockbroker either offline or online.

If you are fortunate enough to have some savings, and possibly have some money to spare, then investing in the stock market is a good idea.

Owning your first stocks has become relatively easy with the digital revolution in place, all you need is little cash, sitting in your bank account, a smartphone/computer, sign up with an online trading broker, click a few buttons and buy some stocks.

Make sure to spend more time studying trends all over the world to make sure you don’t end up buying the wrong stocks.

You should also know that Stocks are often called “liquid assets”, which just means they can be turned into cash relatively quickly.

Most people invest in stocks because they feel like they can call their money back home whenever they want.

For example, if you had $5,000,000 invested in the market at 3 pm on a Tuesday and you wanted to get all your money out right away, you could most likely turn that million dollars into cash in a few minutes with just a few clicks.

5.Invest in Stocks for Income Diversification.

Do you have an active business and you desire to add more income streams to the book? Investing in stocks is not a bad idea because it can help you diversify your income streams, whereby you have various options to make money from.

The more ways you have to make money, the less you’re at risk of getting in financial trouble if anyone method gets disrupted.

For Example, let’s pretend that you have a full-time job, own a real estate business or and dived into the stock market.

When life happens to one of those income streams, you are likely not too loose all at once because one of these income streams will stand up for you. Stocks can be another type of investment, diversifying against potential trouble in any one area.

6. Invest in Stocks So You Can Own Part of a Company You Love.

When you buy even a single share of a company, you’re officially a part-owner. This makes you entitled to a certain part of the company, lets assume you buy a stock in Apple, Inc, then Tim Cook, Apple’s CEO, legally works for you.

Are you passionate about certain brands and you aspire to own part of the company? then buying stocks helps you achieve that If you buy Apple (AAPL) stock, you’re the owner of the company.

7. Invest in Stocks to Learn.

So many people always find themselves making the wrong decisions in life, the good news is that investing in stocks will teach you a ton!.
You get to understand how the stock market works, how companies succeed or fail, how products come to market and how economies impact companies.

You also get to learn about companies and products, analyze CEOs and company leaders, and make important decisions that can have a huge impact on your financial future.

Plus, You will learn to think in new ways. Investing in the stock market requires logic, analysis, and thoughtful reflection. Having these skills as an individual makes you strong enough to be able to make hard life decisions.

How To Start Investing In Stocks.

Companies typically begin to issue shares in their stock through a process called an initial public offering, or IPO.

Once a company’s stock is on the market, it can be bought and sold among investors or better still a stockbroking firm whether offline or online.

Not too many people have enough education to be able to invest properly in the stock market and they lose money as a result of this.

In this article, I am going to prepare you for the right steps to take when trying to invest in the stock market.

1. Research The stocks You Want To Buy And How You Want To Invest In The Stock Market.

One thing that is crucial when choosing to invest in stock marketing is the fact that you need to get your information right, holding on to a breakthrough in the stock market, which is largely determined by the level of knowledge you have about business in general.

There are several ways to approach stock investing. In this article, I would be breaking it down into tiny pieces, so that you know which to get started with.

Choose the option below that best represents how you want to invest, can be broken down into three stages which include.

1. choosing your prefered stocks and funding them on your own.

2. Hiring an expert to manage the process for me, this may be a stockbroker.

Once you’ve identified the target companies that you intend to invest with, it’s time to do a little research.

Start with the company’s annual report specifically the managements annual letter to shareholders. The letter will give you a general narrative of what’s happening with the business.

After that, most information and analytical tools that you need to evaluate the business will be available on your broker’s website, such as SEC filings, conference call transcripts, quarterly earnings updates and recent news.

Most online brokers also provide tutorials on how to use their tools and even seminars on how to pick stocks.

2. Choose An Online Stockbroker.

The internet has disrupted the way things are bring done all over the world, and this includes the way stocks are being traded.

The easiest way to buy stocks is through an online stockbroker. After opening and funding your account, you can buy stocks through the broker’s website in a matter of minutes. Other options include using a full-service stockbroker or buying stock directly from the company.

Opening an online brokerage account is as easy as setting up a bank account. All you need do is to complete an account application, provide proof of identification and choose whether you want to fund the account by mailing a check or transferring funds electronically.

Once you have set up and financed your brokerage account, it’s time to dive into the business of picking stocks.

A good place to start is by researching companies you already know from your experiences as a consumer.

Don’t let the fluctuating data and real-time market gyrations confuse you as you conduct your research. Keep the objective simple: You’re looking for companies of which you want to become a part-owner.

You should also keep in mind that, Warren Buffett famously said,

Buy into a company because you want to own it, not because you want the stock to go up.

He’s done pretty well for himself by following that rule.

3. Decide How Many Share You Want To Buy.

You should feel no pressure to buy a certain number of shares or fill your entire portfolio with stock all at once. Consider starting small by purchasing just a single share to get a feel for what it’s like to own individual stocks and explore how thick your skin could be after losing little.

You can add to your position over time as you master the shareholder swagger. One of the smart ways to start investing in stocks is to make sure to cast your bread upon the waters. But I recommend you start as slowly as possible.

Putting all of your money into a single stock is a risky strategy, even for professional investors. Stocks can fluctuate wildly in value and even become worthless, so you are putting your money at risk if you only buy one stock.

 

What do you think?

Written by Udemezue John

Udemezue John is a web developer, digital marketing expert, and a Serial Entrepreneur.

He Started his digital marketing career at a Health and Wellness network marketing company where he learnt to create paid Facebook ads and Google ads.

He brings a unique, uncensored approach to his travelling experience and writing.

He is also a seasoned investor, a finance education expert currently exploring the stock market and Cryptocurrencies.

His work is published in major publications on Medium.com, and many others.
Udemezue John started my journey as a digital nomad in the year 2013 after completing his high school, to seek financial freedom, and also to help small and large scale business seek the financial freedom they need.
This is more reason why he started this blog and also started his digital marketing company called Inspire Africa.

Life is to be enjoyed. You can connect with me on twitter Twitter.com/_udemezue

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