When I started investing in the stock market, there were things that I put up first. I did not just jump right away into investing bandwagon because I want everything to be in the right place.
Things I Did Before Investing in the Stock Market
These are the things I did before getting my feet wet in the stock market.
1. Establish my emergency Fund
When I thought of investing in the stock market, I know that I will do it for the long term. I just cannot withdraw my money anytime in the market if I want it to be profitable.
So it is just common sense that I would establish my emergency fund first. I want that my money in my brokerage account will not be touched when I have financial emergencies.
The stock market goes up and down so if I do not have emergency fund in place, I will be forced to liquidate my funds in the stock market even if its a loss. I don’t want it to happen.
So the best thing to do is established emergency fund.
2. Read and research about Stock Market Investment
I heard a lot about stock market investing and my office mate kept on prodding me to open a brokerage account. However, I did not start trading until I have done my own homework- that is to study the market myself.
Once I figured out what to do and what investing style I would follow, that’s when the time I entered the market.
It is imperative that we have to know what we are getting into. Especially in investing our money. It is a hard earned money after all and we do not want it to just go to the drain.
3. Get rid of my Consumer Debts
Although I have been always a mindful spender, I had few debts that I consider consumer debts because they are outside of my mortgage. I want to crush off those debts in order to funnel the money into investing.
Aside from that, investing while keeping those debts feel like counter-productive. So, I made the intention to pay off those debt and put a timeline on when I should be able to get rid of them. I thanked myself for doing it.
4. Set aside Money that I don’t Need in the Short Term
When investing became part of my financial goals, I see to it that I set aside a certain amount from my income and put it into stock market investment.
Since my strategy is buy and hold, the key is just to put money into my brokerage account and do it consistently. Although my strategy has evolve over time, it has helped me grow my funds in the stock market.
5.Be emotionally and Financially Ready in getting into the Market
Stock Market investing is like riding a roller coaster. Prices go up and down.
With this, I made myself be aware and be ready emotionally and financially when I entered the market. By being prepared, I still managed to be calm in spite of the dips in the market and suffered a loss.
There you have it folks, the 5 things I did before dipping myself into the stock market.