What should a beginner invest in

How to start investing is a very important question if you are beginner investors and wanna change your financial future life in this or the next few years. After all, as long as you don’t invest your money, there’s no way to see it multiply. Investments for beginners aren’t so difficult, discover your type of investment without spending millions of dollars. 

Today, it is possible to start investing in Treasury Direct or Exchange-Traded Funds. You do not need a lot of money to invest in your personal finance even though you are first-time investors. The important thing is to maintain a frequency in the investments. In addition, the financial market offers assets aimed at all audiences, from beginners to highly experienced investors.

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Set your financial goals

Before you start investing, define your investment goals why you want to grow your money. It could be, for example, opening your own business, investing in individual stocks, gaining financial independence, buying a new home, or doing an exchange, individual retirement for your retirement plans. They get into the concept of the importance of applying for a period of time. 

Determine the amount to be invested

After defining the objectives, you must estimate the amounts of money. This survey is necessary to establish the amount to be invested in this initial investment, and the term of application after decided your investment choices, maybe you’ll need a financial advisor, investment apps, and think about the level of risk analyzing the market performance. 

Remember that the money can be invested at once or every month. The important thing is that it is within your budget and that you are able to maintain your goal and growth investing. Therefore, the idea is to follow a financial plan. With it, you map your finances and see what can be improved. In addition, know how much you have available to invest.

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READ MORE: Is it worth it investing in the game industry? 

Know the types of investments

Basically, there are two types of investments: fixed income and variable income. The first consists of a public or private bond, which is a loan of your money to an institution. In investment returns, you receive a rate of return, which in turn can be fixed or post-fixed and is defined at the time of purchase.

The fixed-rate is a fixed return. For example, 6% per year. Regardless of market conditions, you will continue to receive exactly that remuneration until the due date. The post-fixed rate is linked to an economic index such as the CDI, the IPCA, and the Selic rate.

An example is an investment that pays 120% of the CDI. Therefore, yields may vary depending on the performance of these indices. If they go up, returns also go up and down. 

Know your investor profile

In order to know which applications are most suitable to start investing, it is essential to know your investor profile. It is a simple and practical test in which you will know your risk tolerance the alternative investments. There are basically three types of profile:

  • Conservative;
  • Moderate;
  • Aggressive. 

Search for a financial institution

To start investing, you need to have an account with a financial institution or financial planning services. Always prioritize trustworthy securities brokers. Banks have few products at their disposal and offer unattractive rates of return.

Open your account

After choosing your broker can be the online brokers, you need to create your account. Just enter your personal data, create a login and password. Now, transfer the money destined to start investing from your bank account to the broker’s account through a TED of the same ownership. In a few minutes, the value will be available for use.

Translated and adapted by Billpay

Source: Riconnect