{"id":4505,"date":"2019-04-17T06:01:57","date_gmt":"2019-04-17T06:01:57","guid":{"rendered":"https:\/\/raizinvest.com.au\/investors\/?p=4505"},"modified":"2024-04-23T07:22:10","modified_gmt":"2024-04-23T07:22:10","slug":"five-misconceptions-about-investing-when-youre-young","status":"publish","type":"post","link":"https:\/\/raizinvest.com.au\/investors\/blog\/five-misconceptions-about-investing-when-youre-young\/","title":{"rendered":"Five misconceptions about investing when you’re young"},"content":{"rendered":"

\"WomenBy Alison Banney from Finder.com.au<\/em><\/p>\n

Have you considered dabbling in the share market, but there are a few thoughts you can\u2019t get out of your head telling you that you shouldn\u2019t? Maybe you think you don\u2019t have enough money, or perhaps you keep hearing that you\u2019re too young to be investing in shares (shares are for old people, right?).<\/p>\n

Well, you\u2019ll be glad to learn that most of these myths surrounding investing are just that \u2013 myths. Here are five common misconceptions that you shouldn\u2019t let deter you from getting cracking in the share market.<\/p>\n

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\u00a01.\u00a0\u201cI don\u2019t have enough money.\u201d<\/h3>\n

A lot of people think you can only invest in the share market if you\u2019re loaded. This is far from true, and you can actually start investing in the share market for as little as $5.<\/p>\n

Most online share trading brokers require you to invest at least $500 per trade on the Australian Securities Exchange (ASX), which compared to a property deposit, is a really low entry point. But if you use a micro-investment app<\/span><\/a>\u00a0like Raiz, you can get started with even less.<\/p>\n

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2. \u201cIt can wait until I\u2019m older.\u201d<\/h3>\n

The thing with investing in the share market is that it\u2019s a long-term play. It\u2019s not a way to get rich overnight. The longer you\u2019re invested, the more opportunity you have for your portfolio to grow in value.<\/p>\n

A common expression in the industry is that it\u2019s all about time in the market, not timing the market. So rather than waiting until you\u2019re older and trying to pick a winning stock, it\u2019s a much better strategy to start while you\u2019re young, invest in a well-diversified portfolio and let the market do its thing.<\/p>\n

\u00a0<\/strong><\/p>\n

3. \u201cI don\u2019t know enough about the share market.\u201d<\/h3>\n

The good news here is that you don\u2019t need to know too much about the share market to start investing. You might have memories of your parents researching the performance of different stocks in the weekend newspaper and carefully handpicking which ones to invest in. But this isn\u2019t the case anymore.<\/p>\n

Thanks to products called exchange traded funds<\/span><\/a> (ETFs), you don\u2019t have to worry about handpicking single stocks to buy. ETFs track the performance of a whole bunch of underlying shares, giving you the chance to access a large bundle of companies in one single investment that\u2019s managed on your behalf.<\/p>\n

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4. \u201cIt\u2019s too risky for me while I\u2019m young.\u201d<\/h3>\n

It\u2019s easy to understand why a lot of young people think share trading is too risky. You\u2019re right, shares are a high-risk asset. But the funny thing is, share trading actually becomes more and more risky the older you get.<\/p>\n

When you\u2019re young, you have your whole working life to ride out any volatility in the share market. So even if there\u2019s a dip or a bigger correction in the market and your shares fall in value, you have plenty of time for them to build themselves back up again. However, if you\u2019re older and closer to retirement, you need to be focused on protecting your nest egg. If you\u2019re in your 60s and there\u2019s a crash in the market, you might not have enough time left to build your portfolio back up again.<\/p>\n

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5. \u201cI should be saving for a house deposit instead\u201d<\/h3>\n

There\u2019s no reason you can\u2019t invest in shares and save for a house deposit at the same time. You don\u2019t need to put your entire life savings into the share market, but putting a percentage of your savings in shares while the rest stays tucked away in a high interest savings account<\/span><\/a> could be a good strategy to build wealth.<\/p>\n

It\u2019s also good to remember that shares are generally considered a liquid asset, meaning they can easily be sold if you want to cash out, and you won\u2019t be stuck holding them while you wait for an interested buyer. So if you do want to sell you shares when you\u2019re ready to buy a home, it\u2019s simple and quick to do so.<\/p>\n

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Don\u2019t have the Raiz App?<\/strong><\/h3>\n

Download it for free in the App store or the Webapp below:<\/p>\n

\n

\"download-raiz-app\"<\/a>
Click to download the Raiz app<\/a><\/figcaption><\/figure><\/figure>\n

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Important Information<\/strong><\/span><\/em><\/p>\n

The information on this website is general advice only. This means it does not take into account any person\u2019s particular investment objectives, financial situation or investment needs. If you are an investor, you should consult your licensed adviser before acting on any information contained in this article to fully understand the benefits and risk associated with the product.<\/em><\/p>\n

A Product Disclosure Statement for Raiz Invest and\/or Raiz Invest Super are available on the Raiz Invest website and App. A person must read and consider the Product Disclosure Statement in deciding whether, or not, to acquire and continue to hold interests in the product. The risks of investing in this product are fully set out in the Product Disclosure Statement and include the risks that would ordinarily apply to investing.<\/em><\/p>\n

The information may be based on assumptions or market conditions which change without notice. This could impact the accuracy of the information.<\/em><\/p>\n

Under no circumstances is the information to be used by, or presented to, a person for the purposes of deciding about investing in Raiz Invest or Raiz Invest Super.<\/em><\/p>\n

Past return performance of the Raiz products should not be relied on for making a decision to invest in a Raiz product and is not a good predictor of future performance.<\/em><\/p>\n","protected":false},"excerpt":{"rendered":"

By Alison Banney from Finder.com.au Have you considered dabbling in the share market, but there are a few thoughts you can\u2019t get out of your head telling you that you shouldn\u2019t? Maybe you think you don\u2019t have enough money, or perhaps you keep hearing that you\u2019re too young to be investing in shares (shares are […]<\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_mi_skip_tracking":false},"categories":[1],"tags":[],"yst_prominent_words":[]}