The average person may see the recession as a time to financially withdraw. They may think that because of the housing market failing, major banks going broke, and thousands of innocent people plunged into debt, there’s not a better time to run away. In fact, there’s not a better time to capitalize! A real entrepreneur would invest now because of the opportunity. No matter what your age (see this post), and you have $500 or more lying around, invest; there are several good reasons to do this.
Buy Low, Sell High
The stock trader’s motto, it’s deadly accurate for what should be happening right now. Today is a great time to buy stock. Generally, stocks lessen in value during an economic downturn because there are less people wanting to buy it. It’s the law of demand: if little people want to buy a product, the price goes down, and vice versa. Take advantage: rearrange your money into a portfolio that has a long-term return, because:
It’s Going To Go Up
The TSX (Toronto Stock Exchange) recently reported 5 straight months of growing profit! The recession has provided us with some of the lowest prices that we’ve ever seen on big companies’ stock. Normally, a severe downturn isn’t followed by a worse downturn. Sure, the economy will take a while to bloom again, but there are almost guaranteed profits (don’t hold me to it) if you buy in a safe, long-term stock (preferably) now. Even if you don’t have money to invest right now, see this post to find out how you can simulate investments, for free!
Stimulate The Economy
It’s what we need. We need investors to start re-building the economy, as well as the trust between companies. Your investment will help a company regain its balance, while the investment will be pretty safe for the next little while (until the market really fully regains stability).
You’ll Learn Valuable Lessons
As a teen, we learn things! So if we learn to take advantage of the market now, we’ll be able to use it later in life. This provides a huge head-start! Also, investing at this time will give you a wealth of economic experience (pun intended).
If you have any questions, feel free to email me.
Disclaimer: I’m not a stock market professional, so I’m not liable for any losses in this market – but I would appreciate some praise if things go well!
I got a question from a reader a few days ago about investing. He points out that the legal age to invest in the US is 18, and 19 in Canada. He said that he’s then confused as to how I and any other teen under 18 can invest!
My portfolio is my own, and so are my investments. Yet there’s a simple answer to this question. My investments are in my name, but are in trust from my parents. That means that legally, they’re operated by my parents, but they’re held by me. See? It’s a simple bypass of the system!
I’ve been investing since I was eleven. If you’re under 18 or 19, and you have maybe $500, $1000, or even $2000 just lying around in your savings account, ask your parents to set up an investing portfolio in trust for you! Don’t worry, you pick the investments. There’s no limit to the age you can invest at, because why would there be? Age plays no factor.