How I Started Investing

Hey everyone! Today I want to outline how I first started investing and how easy it can be for anyone.

I want to preface this post by saying, whilst I am studying business, before starting this journey I had no previous knowledge of finance and most of the time struggled to even commit to saving. While I hope to help simplify the process for students and fresh investors like myself, the steps I took are most likely imperfect.

Now let’s get down to how it all started. Coming into my third year of uni I needed to finalise what my major would be for the remainder of my degree. After a couple of weeks of going back and forth over the unit outlines on my uni’s website I decided to see the career counsellor at uni. She told me many things but it stuck with me when she said that finance majors usually have been playing around on the stock market or simulations of the stock market since they could. This ultimately led me to not choose finance as my major, but I did wonder why I hadn’t been curious about the stock market before.

I went home that night and started researching and ended up on the ASX website which felt like it was in another language. The next thing I found was this post on the DollarWise blog. It does an incredible job of laying out 3 really simple ways to start investing in the share market. They also have two other posts about what kind of shares to start your portfolio with and what to look for when researching shares. If you’re thinking about getting started in the share market I would take the time to read these posts. I can’t say enough for how simple they make it all seem.

From here I thought I was ready to tackle the investing world and begin building my hypothetical millions. I made a new budget and planned to buy a few shares fortnightly when I got paid. I quickly found out that I’d missed two key things, which halted my dreams of student investing mastery.

  1. Brokerage fees are per transaction, not yearly or monthly as I naively assumed
  2. When first buying shares from a company you must buy a minimum of $500 worth

I probably should have been smarter about the brokerage fees, but I didn’t find out about the $500 minimum buy in until my first purchased declined and called the brokerage company. My dreams of casually investing $25 a fortnight suddenly came crashing to the ground.

 

giphy

That’s where Acorns came in. Acorns is an app that links to your bank account and rounds up purchases to the nearest dollar, investing the difference in an Exchange Traded Fund (ETF). Put in simpler terms each time you buy something it will round the purchase up to the nearest dollar. When the total of round ups reaches $5 it takes this out of your account and converts them into shares on the app. You can choose riskier or safer portfolios of shares and make manual deposits or withdrawals as well. I found acorns so effective for me for the following reasons.

  • I can invest as little or as much as I want each fortnight.
  • Watching my portfolio go up or down each day scratches the investing itch I have in a safer way with less funds invested.
  • It takes 3-7 days to withdrawal money from the account so if I find myself short of money (as students often do) I can’t grab it quickly.

The other thing I found was that because I had to wait to accumulate $500 to invest it gave me more time to research and make safer investments.

I would strongly suggest acorns for beginner and student investors. If you do decide to use them sign up using this link and we both get $2.50 once your account is set up.

The last thing I would suggest you do is check out some of the other Australian Personal Finance blogs out there. Most do a great job of making investing much more accessible and you can find link to some in my resources

Sorry about the long post guys but if you made it to the end here’s another cute photo of Bino as a reward.

IMG_20170220_124534

Thanks again for reading and let me know in the comments if you think there’s anything else that would help me or other young investors get started.

Advertisements

6 thoughts on “How I Started Investing”

  1. Thank you for your post, I’m interested in investing and am feeling a little overwhelmed as to where to start. Definitely think I’ve learnt some valuable information here 🙂
    I’ve tried to click the link you shared in this post (on DollarWise) but the link doesn’t seem to go anywhere, are you able to share it here or fix the link in your post? Thank you!

    Like

    1. Thanks for the comment! I’m glad I was able to help you. Thanks for letting me know about the link too, it should work now. If you’ve got any other questions just let me know, I’ll try my best to answer them.

      Like

  2. Just discovered your blog and really enjoying the read. I too am on a similar journey and look forward to seeing how you progress. Keep up the good work, and remember the goal is long term, but track your short term success.

    Like

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s