For those who are taking their first steps in the financial market, following investment tips for beginners and understanding a little more about the available assets is one of the best ways to succeed. Learning from those who have already walked a successful path can help make the journey lighter and more enjoyable. In addition, it avoids dangerous traps by protecting the capital from miraculous promises of rapid enrichment.
This article has exactly this intention. As you read the text, you will understand the importance of following the recommendations for beginners. Then, you will get to know the 6 main tips for those who are starting in the world of investments.
The importance of knowing the investment tips for beginners.
The financial market is full of products and services. Few branches of business present such a large offer for someone to choose where to put their money. Therefore, one of the most important points when it comes to investing is precisely to know which products are best suited to your profile at any given time.
When someone is still in the initial steps of their wealth building journey, studying the best investments for their portfolio can be a watershed between failure and success. Seeking financial education is one of the best tips a beginner can follow. In this sense, other recommendations are just as essential, and to help you with this we present below 6 highly profitable investment tips.
1. have a financial plan
Every start of a successful investment portfolio is based on a solid and efficient planning. What's more, it takes discipline to implement it as initially described and to follow it to the letter. This is how the largest financial investment estates were built, even if they started out small.
Therefore, try to elaborate a financial plan that is adequate to your reality in relation to your current income. There is no point in planning to invest 50% of what you earn and later have needs that make you withdraw the money invested. For the amount to stay invested for the necessary time, it is necessary to adjust several factors, among them the percentage destined to the applications.
2. Pay off eventual debts
A good start of a financial planning may be the settlement of eventual existing debts. And the logic behind this orientation is very simple: it makes no sense to have an investment that yields 10% a year, for example, if the investor has a debt that runs at 50% a year. There will be a deficit in this account that will jeopardize the plan previously made.
The goal should be to become an interest earner, not an interest payer. Therefore, for financial planning to be successful, you need to put an end to the debts that drain your resources every month. And the best way to do this is to reduce the principal of the debt until it becomes zero. After this, you can move on to the actual portfolio investments.
3. Have a financial reserve
Once the debts are paid off, the best thing to do is to start building up an emergency financial reserve. Complying with this step is important because it helps not to intervene in the investments in case of an urgent need. Therefore, it is recommended that this amount be equivalent to the monthly expenses for 3 to 6 months.
As the emergency reserve resource must always be available and in an amount that does not oscillate downwards, the choice to be made must be a fixed income investment. What's more, it must have immediate liquidity, given the eventual need for urgent redemption. A good recommendation is a public bond called Tesouro Selic. It gathers all these characteristics and still yields the equivalent to the Selic rate.
4. Set goals and objectives
Although this tip appears only now in the text, it must be considered when preparing the initial planning. Without knowing where you want to go, any result will do, and this is not what a beginner investor should seek.
To build an investment portfolio that results in an interesting net worth, it is necessary to consider the investor's needs. Some want to retire at 50, others at 70. In short, each person has his or her own objectives. In addition, knowing whether or not there is an intention to pass on the assets directly impacts the final value to be accumulated.
5. Get to know investments for beginners
For those who are starting out in the financial market, it is important to take things slowly. It may seem redundant, but the beginner must start at the beginning. Seeking reliable sources of financial education helps a lot at this moment, because it avoids losing money with unknown applications.
Investments in futures markets, for example, should be avoided by beginners. Investment funds and fixed-income securities are a good place to start. As you evolve in this direction, you can look for investments that expose your capital to greater risk, such as stocks and real estate funds.
6. Diversify your portfolio
As shown above, diversification should be part of a well-structured investment portfolio. However, you don't need to wait for a great evolution in your equity, because this must be done from the beginning of the portfolio assembly. Even for those who want to invest only in fixed income, it is interesting to try to acquire different papers in the market.
The reason for this is never to depend on just one source of income for the investments made. In the case of fixed income, it may be that eventually an issuing bank will have problems with the securities it has issued. If an investor is 100% positioned in one of these bonds, he or she may have headaches. However, with capital allocated in more than one bond, the risk is minimized.
Following these investment tips for beginners will certainly make all the difference in the success of wealth building. An important point to highlight is the need for patience regarding the process, especially in the initial years. It is this kind of behavior that leads to success when the subject is medium and long-term investment. Never forget the results of the promises of rapid enrichment often seen in the news. Take it easy!
