MONEY MATTERS : 5 SIGNS THAT STOCK MARKET INVESTING IS FOR YOU

Stock Market. BIG WORD! Specially to those who get goosebumps when confronted by figures and numbers. However, there's more to stock market than meets the eye. It's as close to a logic that everybody needs money to survive. stock market investing, being a good wealth generator, can be an idea worth looking into.

Why? Probably because, you have goals, you need money and you can do it! However, it is NOT for everybody. Jumping into a bandwagon without considering important information can be a recipe for disaster. So be careful!

I've come up with this blog's MONEY MATTERS series because I desire to share what I know {and continuously learning} about financial literacy. If you want to add more money into your wallet, brace yourself and check these tell-tale signs.

5 SIGNS THAT STOCK MARKET INVESTING IS FOR YOU

1. You have goals.

Who doesn't? Right! It's best to associate your efforts with your goals. Ask yourself, what do I want to do 5 years from now? Travel. Study. Retire. Shop. Do Charity. Name it. Be specific as possible. When you do that, chances are, you'll ask another deal breaker question. What steps should I do to achieve these goals? Without the second question, rename everything. Those are not goals but only wishful thinking.

2. You have a steady stream of income.

Let's be clear on this. We are stock market investor not traders. We're investing our money to companies that will be here for the long haul. If your friend will borrow a money from you because he wants to do a restaurant business, you won't be asking him to pay you after 2 weeks time, right? That's also the picture of us investing in PLDT, Jollibee, etc.

What's the relationship of this to our income? Well, because we need to eat and shop and take a bath. And we have to have a fixed resource to address our daily sustenance aside from our earnings in stock market. Studies show that by year 5, you'll be more likely to double your income when invested in good companies - BUT you need to eat in years 1 through 4. It's very important that you get this straight before moving forward.

3. You can put aside a chunk of your money for 5 years or more.

Very much related on Sign #2. Stock market investing is best if you'll let your money grow for 5 years or more. Fluctuations and other factors may affect your stock value on a short term horizon, but again, it's backed up by studies that 5 years is a good ball park figure to let your money earn. 

If you want to earn but are not comfortable with time horizon {say, you prefer to invest but only for 1,2 or maybe 3 years}, that's when savings, time deposits and bond funds come into play. Note though that the income from stock market yields the highest return. As they say, more risks, more returns. 

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4. You understand how it works.

This is not to say you have to know everything about stock market, because seriously, who does? What's crucial is you know the basics on how it works. As they say, the riskiest investments are the ones you know nothing about. If you're starting to yawn and ready to give up, please read back Sign #1. You have goals right? So let's proceed! ☺
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5. You are willing to take 'calculated' risks.

The most important one!  Emphasis on the word "calculated". We are not gambling and taking wanton chances but instead, we do our homework, get informed the best that we could and act based on our best judgment.

So, is stock market investing for you? -CMK