Investing is one of those odd things I can easily define, but I have no idea how on earth it actually works (another topic in this category includes space - I understand how it works but not why 😵). The official definition is putting money into ‘financial schemes, shares, property, or a commercial venture with the expectation of achieving a profit’, and was also already aware that compared to a savings account, investing money doesn’t have the same guaranteed return - yet it does have the ability to produce a far larger gain. If I’m being honest with you, this is where my knowledge on the subject ends. However, I’m keen to learn more - so let’s unpack investing for beginners together in order to unlock our best financial futures 💸

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After doing some reading, it appears there are lots of different things you can invest money in; from stocks and shares to property - and even fine art. MoneySavingExpert (founded by my fav Martin Lewis) notes the most popular forms of investment as:

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• Shares 
• Funds
• Bonds
• Government bonds (gilts)
• Property

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My research has also shown that the first toe-dip into investing for most involves putting money into the stock market; which is where you’re able to buy shares in a company (or companies) with the intention of making a profit. MoneySavingExpert define the stock market as ‘a place where buyers and sellers meet to sell shares – each one a tiny part of a company listed on an exchange’. So, you buy shares of companies you believe will increase in value, and then sell them once they’ve done so. In all the articles I’ve read, it's continually mentioned how important it is to do your research and invest in something you understand, as there's always a risk that your investment could lose money rather than gain it! The top tips I found for your first investment include:

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• Sorting out a pay-off strategy for any personal debt before investing. If you’ve borrowed money that needs paying off, it’s best to do this first! As mentioned, you could lose money as well as make it - so it’s a good idea to have all debts paid off before starting your investing journey. Funnily enough - I know an app that can help with just that! Sign up to Incredible now to automate and optimise your repayments, saving you money and getting you out of debt faster; allowing you to get investing ASAP 😎
• Taking your time researching the companies you’re interested in. Research their history, their current and predicted value, and the wider market of the industry. Is the industry you’re investing in one that’s on the rise, or one that’s starting to stagnate? Don’t rush into investments - keep your eye on your selected market for a while before buying your first shares
• Figuring out what your goals are. Investing is a long term venture for increasing your wealth - not a get rich quick scheme
• Keeping a cool mind. Stocks can go up after going down, so don’t sell at the first loss
• Only investing what you can afford to lose. As we’ve discussed, investing is not a guaranteed method to increase your wealth - so make sure you’re not going to face financial ruin if you lose the money you invest
• Diversifying your investments. If you only invest your money in one company and/or industry and it results in a loss - that’s a loss across the board! However, if you’ve split your investments over multiple companies, you’re more likely to see at least some gains

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I don’t know about you, but although I now know to research before I invest, I’m now unsure where to actually begin this research! Once again enter Martin Lewis, who has shared a great list of free websites that help you figure it all out - i.e. the perfect place to start. I’ve also found that most investors suggest keeping it super simple by downloading apps that do the hard work for you - such as Plum or Money Box, who automatically divide your deposits between your savings and any investment you’ve selected. There are quite a few apps like this out there, so have a look at them to decide which suits you best!

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Following my time spent researching, I feel a lot more confident to take on investing - and have begun to figure out which industries I want to put my money in. I’ve also downloaded Plum so it’s ready to go when I’ve made my choices - and hopefully it won’t be too long until I purchase my first stock! Let me know if you’re also ready to brave investing, and we’ll continue this journey together 😎

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