Topic: am an employee with a meager income, my question is that how to invest my hard income so that it will double?
June 25, 2019 / By Bryana Question:
investing my money so that it will multiply because it looks like am just spending and nothing to gain, aside of course the necessities for the family.
Allana | 4 days ago
An introductory book like _Stock Markets for Dummies_ is a good place to start. This will give you a basic explanation of most things there are to know about the mechanics of stock investing including useful websites to surf.
Investors Business Daily (IBD) is a solid daily resource (and its complement, www.investors.com ). It's a better newspaper than the Wall Street Journal and it is built around a particular approach to trading. You could read _How to Make Money in Stocks_ by William O'Neil too--he's the founder of IBD.
Search your local library for other books on stock investing. Try to absorb as much knowledge and understanding as you can.
After you have extensively researched and gained a solid foundation/education then look to open a brokerage account and paper trade--this is trading with play money before you put real capital at risk. You should do extensively before you eventually place your first trade live. Your early live trades should be with a very small position size. Only increase position size when you have done well to limit losses when the market has turned against you.
The main problem is that people will look at the ten dollars in their pocket and think they can afford everything that's priced ten dollars or less. Truth is, you can only spend a dollar once, if you bought one thing for ten dollars and that was all that you had then you can not buy another thing even though that other thing is ten dollars or less. That's why you are spending everything that you have, you are not earmarking the money for specific purposes.
The way around this is envelope budgeting, in it's purest form, you would put your money into envelopes labeled by what the money is for such as rent, utilities, gas, food, savings, investments, etc. and you would never take money from one envelope to make up the short fall in another.
Banks now allow you to have as many savings accounts as you want and assign various nick names to the accounts for this purpose. Before Washington Mutual went belly up, they had a feature of sub accounts where you could subdivide the money in an account into virtual sub accounts, this had the benefit that all your money earned interest as one account (you lost less due to rounding error) but the problem was when they went belly up, all those sub-accounts merged back into one account and the earmarking information was lost.
Of course, this is just a convenient way to budget and you still need the discipline to stick to it, the only way to develop discipline is practice, best started at a young age so they sell children's piggy banks with multiple compartments to help teach the discipline as early as possible.
Invest in knowledge first. Study the habits of the most successful investors - many of them wrote books and reports.