If you want to become a millionaire, one of the best routes you can take is investing in the stock market.
You may not create the next big tech company or become a CEO because that’s pretty rare, but becoming a millionaire via the stock market and investing isn’t so rare. In fact, it’s become one of the biggest creators of millionaires in the world, particularly with all of the record highs that have been seen in recent years.
Is it possible there will be a big drop from those highs? Of course, there always is, but that still doesn’t mean you’ll lose it all.
In fact, had everyone stayed in the stock market following the 2008 collapse, they’d be doing very well right now and the ones who did, are.
There’s a big problem though, and that’s the fact that so many people are terrified of investing. It’s not an unwarranted fear, but it’s one you need to get over if you want to build wealth. The fear of investing tends to hit Millennials the hardest because they saw first-hand the very real effects of the Great Recession.
So what can you do to get over your fear, and invest even when you’re scared?
Prepare Yourself For the Worst That Can Happen
When you invest money, just think about the worst that can happen. When you’re a young investor, in particular, the worst isn’t so bad. It can be tougher for older investors who are closer or in retirement to weather a decline, but if you’re young, your portfolio may lose value for a period of time, but you’re not living off that money anyway.
Over the course of 20 or 30 years, however, it’s extremely unlikely that you’ll be dealing with any sort of loss and instead, you’re likely to have significant gains.
Learn About Investing
Knowledge really is power when it comes to investing. The more you know, and the more you understand the intricacies and dynamics of the market, the less anxiety you’re likely to feel, and the more risk you might be willing to take.
People who understand the technicalities of trading and also understand how the patterns work are much more likely to do well at investing.
Automate Your Investments
Sometimes the best way to put aside money into your savings account is to set it up so that it’s automatic, and you can do the same for your investments.
If you’re sitting there staring at your bank account balance and you’re just viewing putting it into the stock market as seeing it disappear, it’s scary.
Start with small amounts that you set up to automatically be withdrawn from your checking or savings account instead. Set it up initially as an amount you won’t miss, and as you become more comfortable with the whole scenario, increase it.
No one expects you to immediately invest your entire savings because that would be terrifying and probably not wise for anyone.
Finally, speaking of savings, make sure you do have a healthy savings account before you do start investing, so you’ll always have that peace of mind.