Another reader submission ‘How do you research? How do you set goals?’
This week, I’ll be breaking out another reader submission. One of my good friends asked the following: “How do you do your own research? What are some tips for younger people or beginners? What should people consider, especially if they have a higher risk tolerance? How do you set investment goals, and stick to them? Also, do you have any advice on knowing when to sell and/or when to take profits? When to reinvest? Any tips on learning not to be emotional when investing?” – Aaron G.
Man, those are great questions – especially for those that are just getting started in their personal finance life. I’ll break each question out and offer some insight into what worked for me!
- “How do you do your own research?“
You do your own research by sitting down, and taking the time to research or click around on the internet and reading. It just takes is a focus area and a curious mind. For example, by reading this blog, you’re already 1 step towards your goal of learning more.
For a beginner research approach, ask yourself – ‘what do I want?’.
If stocks or bonds interest you, start with using Google search and type “What are stocks?”. This will put you on the path to learning more.
For an intermediate/advanced level research approach, you have to focus further: ‘What do I want to do with my money?‘. Look into research tools, here’s a list of tools I use to learn more about what to do with my money:
Investopedia – A wiki style learning platform, always up to date, well written
Mr. Money Mustache – A finance blog focused on financial freedom & wealth
Morningstar.com – An investment center focused on long term growth
Stay curious and look into those resources – you get better at researching by sitting down and doing the work (i.e. reading about stocks, bonds, asset classes, retirement accounts) - “How do you do your own research?“
You do your own research by sitting down, and taking the time to research or click around on the internet and reading. It just takes is a focus area and a curious mind. For example, by reading this blog, you’re already 1 step towards your goal of learning more.
For a beginner research approach, ask yourself – ‘what do I want?’.
If stocks or bonds interest you, start with using Google search and type “What are stocks?”. This will put you on the path to learning more.
For an intermediate/advanced level research approach, you have to focus further: ‘What do I want to do with my money?‘. Look into research tools, here’s a list of tools I use to learn more about what to do with my money:
Investopedia – A wiki style learning platform, always up to date, well written
Mr. Money Mustache – A finance blog focused on financial freedom & wealth
Morningstar.com – An investment center focused on long term growth
Stay curious and look into those resources – you get better at researching by sitting down and doing the work (i.e. reading about stocks, bonds, asset classes, retirement accounts)
- What are some tips for younger people or beginners? What should people consider, especially if they have a higher risk tolerance?
Invest early, and invest often. The best time to invest was 20 years ago, the second best time to invest is Today. No amount of money is to small to start investing, and contributing to your future. The greatest financial risk is NOT investing and risking missing any and all growth.
You can get started today, here are a few options to get investing with less than $5:
Robinhood.com – Investing for all, get started with as little as a dollar
Acorns.com – Invest with every purchase you make (round up method)
Charles Schwab – My personal go-to for all investing options
…Easy mode – Buy Exchange Traded Funds (ETFs) like Vanguards S&P 500 fund called VOO – it’s a index of the top 500 companies in the U.S. and get an average ~10% return on your money over 10 years (on average). Next…
- Last but not least: “How do you set investment goals, and stick to them? Also, do you have any advice on knowing when to sell and/or when to take profits? When to reinvest? Any tips on learning not to be emotional when investing?”
I set investment goals by starting small. Like $10 dollars a month small.
Goal: Save & Invest $10 this month.
Evaluate: Was I able to prove to myself that I can invest $10 this month?
If YES: Set a bigger goal. Double it. $20 next month.
If NO: Be critical – Why wasn’t I able to save $10? Do I suck at personal finance? Did I buy too many taquitos at 7/11? Why can’t I dedicate $10 to a better future? Do I need to learn skills so I can get a better paying job?
Advice for selling stocks or ETFs is tough: I recommend buying and holding until retirement age – because investing is just that – it’s buying a part of a company, with the intent that the company will be around in the next 50+ years. The only time you should sell is if YOU personally don’t believe in the company anymore, and you don’t like their business or products.
Similarly, you should continually reinvest in companies you believe in. Any time you have spare cash, throw that into companies you believe in. Be it Microsoft, Apple, Alphabet, Tesla or others – reinvest in what you research and think will stick around for a while.
Lastly – In order to take emotion out of investing, you must recognize that sentiment changes over time. When you stop thinking in terms of days and weeks, and think about your future in terms of years and decades, then and only then will you be emotionally secure (it will help you mentally during financial crises like the 2008 housing crisis or 2020 COVID pandemic).
If you found this long-form post interesting, feel free to subscribe to Military.Cash – I’m going to be continuing to post for years to come 🙂
It’s been a pleasure writing based on user generated submissions. If you liked this please leave a comment below, and click the like button. It lets me know I’m doing a good job.
As always,
-Michael, with Military.Cash – Follow me on Instagram with the icon below.
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