Get Started with Stock Investing

The Simple Dollar personal finance blog posts a helpful primer for those thinking about getting started with stocks, or even just mutual funds and other market investments. Getting debt under control and keeping a reserve fund is the first priority, of course, but once you’re comfortable in your financial skin, Trent recommends performing a risk inventory on yourself before even looking at a stock chart:

Spend some time thinking about this. Would you not worry if you woke up and found out that you had lost 5% of your investment if you knew in the long run it would build up in value? How about 20%? If you had $10,000 in stocks, and then over a very bearish month, $2,000 of that vanished, how would you honestly react? Would you take your money out?

Sage advice, and the rest of the post should be familiar to those who have met with financial counsellors before. For more beginners’ guidance, check out Moolanamy’s 35 common sense rules for investing.