If you read the previous investing tips, you are ready to start investing!
Here is how you invest your first $1,000.
Your first investment is always a little nerve-racking. You’re about to put money in the market and watch it go up or down. The following steps will ease your nerves and allow you to get started with confidence.
Steps
1. Select a Broker
Before you start investing, you’ll need to set up a broker if you haven’t already. Tykr is a stock screening platform, not a broker platform. A broker platform is where you’ll connect your bank account and deposit your first $1,000.
Think of it this way…
- A broker is your car
- A screener is your fuel (Gas, Electric, or Hydrogen)
Yes, you can technically join a broker and start investing but you won’t get very far. That’s why you’ll need both a broker and a screener.
Click Here to see the list of brokers we recommend.
When you sign up for your broker, it may ask you if you want a Cash Account or Margin Account. Select Cash Account which means you’ll only invest the cash you add to the broker. Margin Account means you may borrow money from the broker similar to borrowing money from a bank (in the form of a loan). We don’t recommend borrowing money to invest. One main reason is you’re paying interest on that loan.
2. Setup Your Broker
When you sign up for your broker, it may ask you the “Purpose”. Some of the options may include growth, preservation of capital, income generation, hedging, active trading, and speculation. You can select any of these but the option that has the least follow-on questions is Growth. Overall, you want to use your broker to grow your wealth. The primary focus is not to generate income although you can certainly withdraw cash if needed. You will also not use this account to hedge, trade, or buy speculative stocks.
3. Read and Revisit these Investing Tips
Before you start investing, we highly suggest you read all the investing tips. Bookmark this link so you can revisit these tips.
4. Buy Stocks
Once you have your broker set up, you may buy On Sale stocks you found in Tykr. When you buy a stock, your broker platform may have you choose between Market Order or Limit Order. Market Order means you’ll buy at the price shown (or pretty close). Limit Order means you will need to set a limit at which the stock will be purchased. We recommend Market Order as it’s much easier.
5. Relax
If you buy a stock and the stock goes down right away, just relax! If you reviewed these investing tips and bought an On Sale stock, the chances of making money are very high. You have to remember that investing requires patience. You should be buying stocks every month. In many cases, you’ll be buying the same stocks every month and it may even seem a little boring but that’s how you truly build your wealth.
Now sit back, relax, and let the power of compound interest work for you.