Young & Want to Start Investing?

Paul Atherton |
Essential Insights


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If you’ve thought about investing, it’s time to start taking it seriously. Here are your next steps to find success.

Investing when you’re young is incredibly important.

There’s a massive difference between someone who’s invested for 20 years and someone who hasn’t. So even putting aside a little bit of money in a low-risk account isn’t really good enough.

If you were to compare the low-risk saver with somebody who is more market-orientated, with returns on the S&P, the difference would be in the hundreds of thousands of dollars. So, yes, you could be better off by hundreds of thousands of dollars in your 40s if you started investing in your 20s.

I roughly worked out that if an individual placed $5 per day into a savings account (say the cost of a coffee) for 20 years, they would have about $44k saved at the end of those twenty years. Not bad!

But if that same individual placed that same $5 into a high returning account, saying earning 15% per annum, that would now be nearly $200k over that same time.

See, the difference is measured in the multi-hundreds of thousands of dollars.

Now, think about the person who hasn’t put anything aside. So, there can be an even more significant difference between somebody who’s made nothing and someone who’s made nearly $200k.

So why don’t people invest when they are young?

I like to think there are five primary drivers as to why young people don’t invest.

It’s good to understand what the drivers are as to why people don’t invest when they’re young. Then you can see if you can recognise them in yourself, and maybe do something about it.

1.   Your focus.

When you’re young, you’re just starting. You’re just starting your career. So, where would your focus be?

Your focus and your energy are on your income. You think about the way that you’re spending and the way that you’re earning your income. You’re dealing with your career and career development. You’re dealing with the here and now.

It’s far more important to you, and it has far more impact for you right now, that you get a raise now, rather than investing and waiting for 20 years.

Now, it’s essential to remember that the future difference is measured in the multi-hundreds of thousands.

So, you may realise that you only have a small immediate benefit (maybe a sense of pride or hope for your future self), but the longer-term benefits of investing will be significant.

  1. The time and energy it takes.

Investing takes a lot of personal focus at the start. Once you set your strategy and portfolio up, it doesn’t take much at all, but in the beginning, it takes a lot of energy and focus.

If your energy and focus are on your job and your new career, asking you to then put extra time and energy into investing is a big ask. Young people have a lot of pressure to look at various things: their career and personal life.

They have a lot going on. Time and energy are a big reason for the lack of focus on investing.

3. Feeling controlled.

When someone else tells you to invest, it feels like someone’s trying to control you. Of course, it shouldn’t, but it does feel that way.

You’ve just graduated from university; you’ve spent all your life at school. You’ve had to do assignments. You’ve been marked. Your parents tell you what to do. Your teachers tell you to do this. Your professors ask you to do that. You must turn up on time, get jobs done on time. The list goes on.

Then suddenly, you’re released into the workforce. Of course, you’ve got to do your job, but it’s very freeing. Now you’re getting paid to do your work. Then somebody says, right, okay; now you need to start doing this. It feels like someone is trying to control you, and you’re looking for freedom.

But it’s essential to think that investing is you taking control. It’s not somebody else’s control. It’s you taking control over your destiny, but it can be tough to change that mindset once you first get into the workforce.

4. Knowledge gap.

Many people say, well, I just don’t know money; I’m not an expert. Well, yeah, I get that. But it’s crucial to have a level of knowledge and a level of understanding when investing.

But here’s the thing: knowledge is built over time. You build knowledge by doing. You can get help. You can do your research. You can Google. You can read my articles.

My whole ethos is to bridge this knowledge gap.

Knowledge can be a significant impediment, but it can be your friend, and you can get knowledge on your side and develop a program for investing.

5. Logistics and mechanics.

This is a classic reason, but I’m a big believer in this: investing is 20% knowledge and 80% logistics.

What does that mean?

You might say, I want to invest in Apple, or I want to invest in the S&P500, or I might like to invest in Google or whatever.

But what are the logistics; how do you do that? How do you set up an account? Where do you put the money? How do you put in the buy order? Who do you place the buy order with? Where is that money held? How do I know if it’s going up?

The process of investing is all logistics. It’s all mechanics.

In the beginning, investing seems incredibly difficult and confusing.

I had a guy call me up, and he said, I’ve inherited these stocks, and I’ve had them for 15 years, and I just collect regular checks, now I want to sell it. But he didn’t know how to do it. He didn’t know how to take that step because it was logistical.

We went through the process.

I asked, who holds them? Where do you think it is?

We got it sold for him, and it was straightforward, but his impediment wasn’t the lack of desire. He just didn’t know the mechanics of how to do it.

Did you recognise what’s holding you back from investing?

If you recognise any of those, it’s essential to take that head-on and not be discouraged by it.

Don’t be held back because it feels like control. You’re the one who’s taking control. Yes, it will take energy, but all good things take time and energy, but the pay-off, I can’t emphasise this enough, is measured in the multi hundreds of thousands—potentially millions. So do it when you’re young.

And if you’re not young, but you still have these blocks, start working now.

You can always get some help. There are some outstanding advisors out there. There are people with a lot of excellent knowledge, and they can help you.

If you’re young and want to start investing, remember…

  1. The earlier you start investing, the better off you’ll be—the difference between a non-investor and an investor with a strategy is hundreds of thousands of dollars.
  2. Taking the time and focus to learn about investing and set up your strategy pays off in dollars—it’s always worth it.
  3. Investing is taking control of your future—remember that you’re investing for yourself, not because someone told you to.
  4. Research and/or speak to a professional to bridge your knowledge gap—there’s a lot of great (free) resources if you have time, but you can always talk to a professional.
  5. Don’t give up—investing takes practice, patience, and resilience, but it’s worth it.


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This information has been provided as general advice. We have not considered your financial circumstances, needs or objectives. You should consider the appropriateness of the advice. You should obtain and consider the relevant Product Disclosure Statement (PDS) and seek the assistance of an authorised financial adviser before making any decision regarding any products or strategies mentioned in this communication.


Who is Paul Atherton, That Wall Street Guy?

An ex-Wall Street advisor who worked with major players in the global financial industry for over 30 years, Paul’s mission is to help regular people reclaim their wealth and financial security.

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