Learning to invest is a must do as it can help you move from one financial milestone to another faster than other methods. It also teaches us a valuable lesson about wealth building and that is you must have some skin in the game to realize these benefits.
Investing can be in multiple venues, like the stock market, real estate, commodities and the list can go on and on. But, the common thread in learning about these investments are that if you acquire them today hopefully they will be worth much more down the road.
Learning how to invest is a very important skill that can be obtained by attending to school and taking some training classes. But going through the hands-on experience of investing still has the best track record. This is because in learning this craft it takes time and experience as we are not born having this capability to decide what is a good investment and what is a bad one.
However, not every person have the keen ability to become a good investor so you have to be careful in selecting the people who you trust in handling your investment choices. Although most people go to a professional financial advisor to handle their investment needs and I encourage you to do the same if you don’t have the time to look over your investments properly.
However, you can’t be lazy and leave all your investment choices up to someone else as you still need to have some knowledge about investing yourselves. You need to take the time to learn about investing and more importantly how to put it to use if you want to see the true benefits of investing.
Additionally, the sooner that you acquire this skill the better off you will be. It is a known fact that if you are young when you start to invest you have a better chance to succeed as your time horizon is longer. This is because learning how to invest takes time and once you have this knowledge you will most likely do better in handling your business affairs over those who don’t have these skills.
However, understanding the principles of investing is vast and covers a large category. It is not limited to just buying and selling a merchandise, which most people believe it to be. In learning to invest we are making a choice on how to best use our resources ( money, time, securities and etc) to increase the value of whatever we are pursuing.
For example, we would all love to make a boatload of money by investing into a commodity that we are able to purchase at a lower price and sell it at a higher price resulting in tremendous profit. This is the idea situation that everyone remembers when they have made a large windfall profit. However, it sounds simple but it’s not that easy. If it was that easy everyone would be rich and have their vaults filled with a bundle of cash and cash equivalent items.
Historically, people who are good at investing have been doing this process over a long period before they have seen some success. Most of these good investors have gone through dealing with the highs and lows in values of what their investments are. In other words, you have to consider that one day you may be up and very happy and the next day you are on a down and are unhappy.
In another example, when people contribute funds to their 401k and their IRA accounts they are choosing to put away money now with the hope that it will grow appreciatively over time. These are investment decisions that we make on our jobs but we would not participate in this process if we didn’t think that our money would grow faster in this process over other choices.
This investing learning process can also be demonstrated by willing to save your money in the bank while you are renting until we have enough to put down on buying a house. Owning a house is a big investment that can help you in many ways and it is considered one of the largest investment decisions that you make in your life. I recall in making that decision some years ago to buy my house and it has paid off handsomely for me and you can do the same.
In another form of investment, parents make a sacrifice of sending their kids to a private school instead of going to a public school. They can also help pay to send their child to an ivy league college over a local college with the intent that their wages will be higher after they graduate.
For those individuals who don’t have an act for going to college, they can learn a vocational skill which is another form of an investment. The plumbers, the electricians, the bricklayers, cement workers and you get the point, their path to investing is learning their trade. This process takes time and funds also to acquire these skills but it’s an investment that each of them must make to become successful in their fields.
There are additional examples that I can spell out that explains how important it is to learn that investing is a “must do” in each of our lives. The key message of this article is that learning to invest is about dollars and cents but that is not all of it. The topic is also about learning that you have to put in the effort, the hard work, the money and the sacrifice upfront before you can see the fruits of your investment. If you can successfully learn this skill and put it to use, you and your family will do very well in making advances in life, financially and non-financially, and that is the goal.