Do you trade securities and other types of investment materials?

[Rakanoth]

Hi,

 

I am 25 years old and just beginning my master's degree. I have a job experience of almost one year. Now, I want to start investing my money, because as long as the money is in my bank account, I can't help but spend it. So, instead I want to invest my money so I won't be able to spend it on silly stuff. I will start buying securities and precious metals (silver, gold etc.)

 

What about you? Do you sometimes think that you are wasting money because it is right available to you (as in "you can stick your card in the cash machine and withdraw money)? Did you ever consider starting investing money? Why haven't you started already?

[dalekphalm]

1 hour ago, Rakanoth said:

Hi,

 

I am 25 years old and just beginning my master's degree. I have a job experience of almost one year. Now, I want to start investing my money, because as long as the money is in my bank account, I can't help but spend it. So, instead I want to invest my money so I won't be able to spend it on silly stuff. I will start buying securities and precious metals (silver, gold etc.)

 

What about you? Do you sometimes think that you are wasting money because it is right available to you (as in "you can stick your card in the cash machine and withdraw money)? Did you ever consider starting investing money? Why haven't you started already?

Here's my suggestion:

 

Don't buy anything in particular or specifically unless it's part of your "just for fun" fund.

 

For the vast majority of your investment fund, I would suggest you buy into a diverse portfolio, with the correct risk level that you feel comfortable with.

 

You can do this in many different ways, such as a managed fund from your bank, or an ETF/roboinvestment type service.

 

I currently use Wealthsimple (shameless plug, PM me for a reference link), which is an ETF - they have different risk profiles, and when you sign up, you fill out a small survey and it recommends one (usually Balanced).

 

The accounts themselves vary, depending on what kind of account you want - these are typically legal differences, not differences in how the investments actually work.

 

For example, in Canada, you can get:

TFSA (Tax Free Savings Account)

RRSP (Registered Retirement Savings Plan)

RESP (Registered Education Savings Plan)

General Investment Account (This is just a plain old account with no legal/tax benefits)

etc

 

In the US, you will have different options of course.

 

They use an algorithm to manage day to day balancing of the portfolios, but they also have live agents available to step in and make major corrections, as well as give financial advise.

 

The idea behind these platforms is "set and forget" - which might sound bad, but is not, really.

 

Most people lose money when they panic during a downturn, sell, and rebuy later - at a loss. Historically speaking, a well diversified portfolio will always go up. Even if you lose money temporarily during a downturn, history tells us that if you just stick it out, and don't panic sell, you'll end up with a higher return than if you intervened.

 

With that in mind? If you want to be hands on, you can. But most people only think they want to be hands on, because they don't or can't put in the amount of effort and time needed to properly research individual investment (Eg: buying stocks individually, etc).

 

So, as I said, I would choose a nice diversified investment system that can handle your big investments (stuff that will save for retirement and save for future large purchases, etc), and on top of that, if you wish, take a small percentage to use as your "play fund" for investments you want to directly oversee.