Many people dive into investing without really knowing what they’re doing. This can result in rash decisions that lead to money being lost. By easing your way in, you can allow yourself to make a few rookie mistakes while minimizing your losses. Below are just a few ways to ease yourself into investing.
Invest your spare change
You don’t have to dump £1000 into a shares account straight away. There are lots of apps nowadays that require a minimum deposit of £10, some even allow you to invest as little as $1. By investing such small amounts, you can get used to the stakes of investing real money without worrying about losing too much if you choose the wrong instrument.
Top Trading Platforms To Get You Started:
You can drip-feed small amounts of money into your investment account each week. Some apps can even help you to build up funds by rounding up purchases made on your card to the nearest dollar – and then contributing the remaining cents into your investment account.
- Trading 212: Trading 212 is one of Europe’s largest trading platforms. You can deposit as little as £2 and purchase hundreds of stocks and ETFs. They also offer a free ISA account for tax free investing (UK). The platform is available both as a mobile app and via a web browser. Overall the platform is very easy to use with a great selection of stocks and ETF’s, user friendly interface and very responsive. Get a free share when opening an account using this link.
- FreeTrade: FreeTrade offers commission free trading with a super easy to use interface. It really is aimed at new/inexperienced users and as a result doesn’t give you as much analysis and information as the others. However, unless you plan to trade daily, you really won’t need that information. It also offers an ISA option (so you can invest tax free) but this has a monthly charge. Get started with a free share by using this link.
- eToro: I haven’t used eToro before so I cant give you my opinion on it. However, they are also one of the biggest platforms out there (so chances are there’s a reason for that success). One thing eToro does offer vs the others is the ability to mirror other users trading. This means you can simply pick another user with a high return and the platform will automatically invest your money in the same stocks and options as they. Extra points for the laziness factor. As I don’t use it, I wont have a referral link for you but you can still sign up here.
You can similarly invest small amounts with cryptocurrency. Many crypto exchanges have very small minimum deposits as low as 0.002 BTC and 0.1 ETH – you don’t have to invest your life savings upfront.
Top Crypto Exchanges To Get You Started:
- Coinbase: Coinbase is by far one of the easiest to use (and most well established) crypto exchanges out there. It offers simple layouts, graphs and essential information so you won’t feel overwhelmed (there’s also a pro version but its something you can upgrade to at any point). It doesn’t offer that many crypto currencies (of which there are a lot), carefully selecting and listing only the most prominent ones. This is both a good thing and a bad thing, many cryptos are considered to “have made it” once they are listed on Coinbase. The downside is that by the time a currency hits Coinbase the super crazy 10,000% gains are more than likely over. Still, it is safe and reputable and a great place to start. Finally they offer a bunch of quizzes to new users (they normally take a few minutes to complete) and will award you with free coins and tokens. These are yours to keep, exchange or cash out, what’s not to like? Join via my referral link and receive $10 in bitcoin when you add $100 to your account.
- Binance: Consider this a step up in complexity from Coinbase but also a big jump in the number of listed currencies you can trade. My first impression of Binance was ‘information overload’ (incidentally, they do have an option to switch to “Lite Mode” from the user menu on the app, which will take a lot of non-essential information away) but I quickly got acclimated with the interface. I now actually prefer it over Coinbase and as mentioned, it gives me access to a lot more currencies to trade, as well as derivatives, stacking, crypto pools and liquidity swaps. Definitely not for complete beginners but worth it once you are comfortable with crypto trading. Use my referral link to receive a 10% bonus when you fund your account.
- BitMart: BitMart is similar to Binance in many respects but it isn’t anywhere as big or established. So why might you consider it? Well, more exotic coins would be the answer. As mentioned above, by the time a currency hits Coinbase the crazy gains are over. A similar thing happens when they are listed on Binance and more obscure coins will likely be on BitMart first as a result. Getting in early holds the promise of bigger gains but also increases the risk (namely, the coin will go nowhere or worse yet be completely worthless). Only go here once you understand the risks associated with high volatile coins and tokens. My referral link will give you 10% more coins when you fund your account.
Please note, this is not financial advice and you really need to do your own research before parting with your money! Also, take your account security seriously, especially with crypto, use 2 factor authentication, SMS authentication and every possible security feature offered. Never open any links or connect to any wallet addresses that are not your own.
Take advantage of freebies
There are now many stock trading apps that are totally free to use. By using these apps, you don’t have to worry about expensive broker fees. Some platforms even offer free stocks and shares.
As for investments like cryptocurrency, there are also freebies out there that you can look into – check out this guide for earning free Bitcoin in 2021. This could prevent you from having to buy as much crypto upfront.
Observe and practice
Before investing real money, why not consider simply observing the market for a while? This can help you to get used to the way in which stocks, forex and crypto rise and fall.
Some apps even offer free simulations of the stock market and crypto market which you can invest fake money into. You can then watch your instruments grow and fall in value as if they were real money, helping you to get a feel for the real thing.
Build your contributions up slowly
As you start to get used to investing small amounts and you become more confident, you can then start investing larger amounts. Instead of buying $1 shares, you can build up to $5 shares and then $10 shares.
Investing is always a risk and there will still be some instruments that lose you money. However, with time, you should be able to create a portfolio that’s largely in the green and making you a steady return. Learning when to buy and when to sell is often what takes practice. While there is a lot of advice out there on this, most people only really learn it by making mistakes first-hand.