Lessons from putting my money in the stock market
Back in 2010, I did the unimaginable. I put my gifted Christmas money into the stock market.
It was $2000 of cold hard cash turned into a digital currency that a lot of people shy away from due to lack of understanding.
To be honest, I didn’t really understand it either but I understood the concept of trends. During that time, the global financial crisis was in full swing. Stocks plummeted to all time lows and everyone was cashing up — except me.
Last I checked, it’s now worth $7,336.75.
I’m not an expert. Nor do I claim to be an expert. But this would be my advice and musings if anyone ever asked me for it.
If you want to double your investment, you have to play the long game
Because that’s what I did.
Back in 2010, I hardly knew what I was doing. I don’t claim to be an expert in the subject now either, only that over the course of 9 years, I managed to double my initial investment without doing anything much.
The dividend payouts have been great additional pocket money every six months — and more than what the bank would ever pay out as interests.
I could have sold my stock and cashed up when it was worth $5,000 — but I didn’t.
The thing with stock markets is that it always bounces back and is on a general upwards trend. It may dip here and there for what feels like forever, but eventually it will go back up.
“Someone is sitting in the shade today because someone planted a tree a long time ago.” — Warren Buffett
If looking at the company’s books isn’t your strong point, look at the company culture and their alignment with society and technology
Once you sell your stock, then your money becomes real.
When your money is still sitting in the stock market, its value has the potential to go up or down depending on world events, policy, environment and a social changes.
If you don’t know what company to invest in — start off with a low risk one.
This means that the company is well established with values that aligns with society and technology. Invest in well a collection of well established giants. Close your books and let it grow.
Don’t worry if the value dips or peaks suddenly. It happens — especially when they’re competing against other big giants. Microsoft had their bad years and only started to bounce back recently.
Either that or go small but not too obscure. Pick something that has a strong core niche. Pick something you know, understand and will personally support.
I should have continued investing
My mistake was that I didn’t continue to regularly put my savings into the market.
I did what the normal and rational population did — I put my money into my bank saving’s account.
Looking back at it now, if I had consistently put even $2,000 into the stock market per year, I would have had enough money to take out a mortgage. But I didn’t because I was convinced by the mainstream method of dealing with my money.
This equated to mainstream results and struggles like everyone else.
I could have been an outlier but the dots didn’t connect until now.
At 29, self employed, struggling to make rent and baby in tow — it may seem like it’s too late. But every week as my money goes into a pooled investment fund, I remind myself to be patient. Maybe by the time I hit 40, my money invested in the stock market might have compounded.
Either way, it’s better than spending my hard earned cash on a lottery ticket.
Ten years moves very quickly when you’re looking backwards. But time moves slowly when you’re looking forward.
It’s just the nature of how we perceive things.