Investing in the stock market is one of the many ways to invest your money. Billionaire investor Warren Buffett said you can expect a six to seven percent return on your money when investing in the stock market. But, when you invest in the stock market, you want to make sure you make good choices and invest safely. Here are three tips to help you invest your money safely in the stock market.
Save Money for Investing
When you begin to invest your hard-earned money into stocks, you need to go into it with the right mindset. Realize that, as the value of investments go up and down, there is a chance you could lose your investment. So, don't invest with money you may need for something else in the immediate future. Don't use money that is going to go to pay your mortgage or for other upcoming bills. Also, don't borrow the money from a friend, relative, credit card, or other bank. The interest you may have to pay on borrowed money can end up being more expensive than the return you get from your investments, which will cause you to lose money.
The best way to have money for investing is to put a small percentage of your income aside each month. One investing guru, Kim Kiyosaki, recommends setting up three piggy banks for savings, investing, and charity and to save ten percent into each one. So, when you put money aside from each pay check for an emergency or a charity, save a little extra for investing. This ensures you are not risking money that you can't afford to lose.
Use an Online Brokerage Account
An online brokerage account gives you easy access to buy and sell stocks from the convenience of your home computer. It is important to find out what a company's minimum requirement is to open a brokerage account and what they charge per trade. Each time you buy and sell a stock, it is considered a trade and you will have to pay for the transaction to be completed by the brokerage company. Look for a company that has no minimum deposit to get started and low trading fees at around $5 or less per trade.
Practice makes perfect with a lot of different activities, and you can try out investing in stocks online before you put your money at risk. Several online brokerage accounts offer virtual trading accounts so you can practice investing with virtual money before you put your own money at risk. A virtual trading account lets you use real-time quotes so you can watch your virtual trading account gain or lose value as you buy and sell stocks.
Hire a Securities Law Attorney
During your time as a stock investor, you may choose to invest more of your money into one company and you will need some securities protection. You don't want to invest in a company and find out later they were participating in illegal activities, such as insider trading or investment fraud. With any investment, you should get as much information as you can about the company and their business practices, and a securities attorney can do this for you.
A securities attorney has been to law school and is specifically trained in finance, securities, transactions, and business law. They will be able to give you advice on trading stocks and help you do the transactions. They will also make sure the company you are investing with is following all the rules and regulations with selling stock. If you lose your invested money because the company was participating in illegal activities, your securities law attorney in Sacramento, Ca. can represent you in court to get your money back.
These three tips can help you be safe as you invest in the stock market.
