A Beginners Guide to Investing Doesn't Have to be Difficult

Use the following beginners guide to investing to uncover the important basics. There are a number of issues that most people fail to identify with when it comes to investing:

  • When people grow up they are taught that they need to get a job to earn an income.
  • To earn more income they work harder, keeping in mind there are only so many hours in the day, or get a higher paid job. This is conditioned into many people, but it is wrong thinking. Unfortunately if they stop working, then their income stops too.

    A beginners guide to investing demonstrates that to make more money they should actually be putting their money to work for them, rather than working to earn money. To break it down even more, save a little, when you have enough, invest it, save a little more, then invest again. Keep the cycle going. Simple!

  • The second issue carries on from the first in that people tend not to know what true wealth is.
  • If you were to take all your liabilities from your assets, you would be left with what your worth. However true wealth is when you don't need to put in any of your own effort, in the form of labour, and yet you still earn a large income from these assets. Not having to work and being able to do what you want, when you want, is my definition of true wealth.

  • Another point in a beginners guide to investing is that earned income is taxable!
  • There are many tax shelters where the same amount invested would not be taxed. This is an important point because of the power of compounding. Let's look at an example....

    A person earns £40,000pa, and to keep it simple has 40% deducted for tax, which is £16,000, he therefore earns a net income of £24,000pa.(which he will spend most of) If he invested £40,000pa in a suitable tax shelter then this £16,000 would be added each and every year, so instead of earning £24,000pa he would be investing £40,000pa which would keep on growing.

  • The next important point is your financial advisor must be independently wealthy.
  • It's strange why many are not, don't you think? It's a bit like going to have your car serviced by someone who hasn't quite past their exams yet, or proved their expertise. In other words make sure he practices what he preaches.

    Also be careful that they are not just selling their own products to you, make sure they are independant. Oh and another thing, alot of information can be found on the internet without having to pay for it!

Ok, now we are off to a flying start in our beginners guide to investing, I want to introduce you to a few more ideas. Before we go into a little more detail on subsequent pages I have broken down the beginners guide to investing into five more areas.

The reason I have done this is because I believe investing and becoming wealthy is a process and one which you can't just learn overnight. Well I didn't, perhaps you can.

You don't have to get into all areas immediately, in fact its important that you don't and that you focus on only one area at a time. However, this is not to say that you won't have one area that you specialise in and therefore make most of your money.

I started out in property first and it was 2-3 years before I looked at any other areas. I now look at a more balanced approach to investing. The five areas are:

1. Goal setting - it is absolutely imperative that you set goals, in this case financial goals so you don't get put off by other peoples' negativity or life events.

2. Stock market - a complete guide to the stockmarket for beginners including a complete hands off solution which I personally use.

3. Property - how to buy property with little or no money down, ready made deals and three fantastic resources which I still use.

4. Investments - types of investments including some of my own favourite wealth builders.

5. Business - for those of you who are fed up working for someone else or even for those who want to build a business while still receiving an income from their present job. This solution will blow your mind in its simplicity.

Like so many things in life investing is all about education. However it is important that this financial education is the right one. So many people are conditioned into believing what is the generally accepted way of doing something. We have to look beyond that and indeed our own conditioned beliefs and attitudes about wealth building if we are to be successful.

Question everything in particular the way you think and what you believe to be true that just isn't!

return from a beginners guide to investing to ultimate wealth

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Beginners Guide to Investing Quotes

"I will tell you how to become rich. Close the doors. Be fearful when others are greedy. Be greedy when others are fearful."

Warren Buffet

"It is fortunate for Wall Street as an institution that a small minority of people can trade successfully and that many others think they can."

Ben Graham

"We go to school to learn to work hard for money. I write books and create products that teach people how to have money work hard for them."

Robert Kiyosaki

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