Investment is the activity of investing capital or assets with the aim of obtaining more profit, through increasing the value of the investment. These gains are expected to be part of financial stability in the future. But other than that, many are questioning the best age to start investing. One of the options that emerges is to start at the young age of 20 years.
In line with this, quoting detikFinance, Marissa Dewi as Senior Head of Fintech said that the purpose of investing from a young age is to form habits to develop good financial management for the future. That way, wasteful habits will be avoided and the future will be better.
Moreover, quoting from Money Usnews, it is mentioned that time is the biggest asset, so delaying investment has significant consequences. However, before actually deciding to invest in your 20s, it’s a good idea to know some important investment rules below.
Invest with a Prudent Plan
John Cunnison, chief investment officer at Baker Boyer, says that proper planning is one of the key to successful investing in your 20s. Investment planning for the young people concerned includes investment strategies, levels and frequency of contributions in accordance with the targets to be achieved.
The plan will serve as a ‘map’ for the lengthy investment process. In addition, one thing that needs to be underlined is that the success of planning, depends on patience and being able to adapt to all the risks involved. Investments need room to grow, so it requires careful action in dealing with everything. This means, you are not only mentally ready to get rich. But investing is also about you have to learn a lot of things.
Avoid thinking excessively
Learning how to invest in your 20s becomes very challenging. Therefore, it is necessary to limit the mind so as not to think too much about too many things. Andy Garisson, senior wealth advisor at Mariner Wealth Advisors, says it’s important for young people to invest to avoid losing perspective and getting caught up in endless thinking.
Don’t waste time getting stuck in ever -evolving options. Invest immediately according to plan. In short, the sooner you start investing, the less likely you are to work for a lifetime. This is because there are investments that generate more time to enjoy life in the future.
Getting started
These investment rules for young people in their 20s sound simple, but are one of the most important. Daniel R. Hill, president of Hill Wealth Strategies, says that in general, people in their 20s tend to wait. This is because it feels like you have a lot of time.
While on the one hand this is true, Daniel himself prevents his clients in their 20s from waiting. The reason is, the sooner you start investing, the sooner you reach your financial goals.
Don't be afraid of fluctuations
Volatility or market mood is one of the most important things to consider when starting an investment. These fluctuations are related to the value of the investment, either soaring sharply or even falling freely to the lowest price. Not infrequently, this also raises concerns of young people to invest.
For example, about the fluctuations during an epidemic like now. Many are postponing investments and waiting for the market to stabilize. Instead of waiting, Kelly Welch as a wealth advisor at Girard suggests seeing this as an opportunity.
No one knows when the plague will end. Meanwhile, if you are afraid to take action, then the opportunity to buy the investment sold and make a profit when the market starts to stabilize will be lost. Kelly Welch also emphasizes that there is no perfect year, month or day to start investing because the future market is unknown.
But one important thing is to ‘jump’ into it to take advantage. For example, Kelly said “If you’re sitting at the touch line, you’re not in the game”.
Don't Feel Pressured to Do Everything
Investing in your 20s means there is still time to keep growing and try something. To that end, Lindsey Bell as head of investment strategy at Ally Invest says that it is necessary to get used to it before feeling comfortable with market volatility.
Instead of tying all of your assets that can be invested into one stock or fund, another option is to choose micro investments or investments little by little each month. This is important for building an investment portfolio.
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