Do you know the number one way people become rich? You guessed it, the lottery! Just kidding. For most people, their best shot at becoming wealthy comes through long-term, consistent investing and with more and more people realizing this financial reality, people have been entering into the market in droves. In fact, in 2020, 15% of all retail investors had just started investing that year so it speaks to the investing awakening millions of people are experiencing. However, are people making a mistake by buying stocks? I’ll explain why they might be right now!
I don’t think it comes as any surprise that over the last couple of years, a ton of people have become enthralled by the potential to make money and achieve significant levels of wealth through the stock market. I mean, if a 10 year old boy can turn $60 into more than $3,000 in the market then so can you right?
Before we look at the mistake that most stock investors are making I think it’s worth exploring why people invest in the first place. If you ask me, this comes down to two primary reasons. The first reason is that more and more people these days are being exposed to the benefits of investing.
Unlike when our parents started investing, back when you had to buy a newspaper to get updates on the market and track stock prices, nowadays, we have access to more financial information than we even know what to do with. I don’t know about you but I come across enough financial statements and candlestick charts every day to make my head spin!
Now, of course, as someone who loves to share my own financial insights and experiences, I am more than excited to see people taking an interest in investing. If you ask me, school does a terrible job at opening young people’s eyes to the importance of wealth creation but fortunately through the internet and other means of information sharing, financial education is accessible to most.
This is important because for most people, long-term investing is the only way they will amass enough money to support themselves in their later years so gaining this financial education as early as possible is key to future success.
However, with all the benefits that come with starting to invest, it’s not all sunshines and rainbows. If you ask me, the…