13 Jun The easiest way to become a stock market pro
Let’s say you’re in the position of having some spare cash (lucky you!) Hopefully you already understand that investing your money is far better than leaving it to languish in a bank. (In case you’re not familiar with WHY this is so, it’s because a dollar today is worth less tomorrow due to inflation… ie the value of your money in the bank diminishes whereas if you invested it, the aim would be for you to make a return on your investment and therefore it’s worth more.)
I’m aware of this basic principle. I understand that I should be making investments and I’ve done this with property. However, finance gurus advise never to have all your eggs in one basket – diversification is key. So I’d like to branch out into the stock market, but just one problem: I don’t know too much about it. Can I even invest in the stock market without being a broker?
The answer is the app Acorns, which launched in Australia in 2016. Essentially, the app links to your bank account and credit cards and rounds up to the nearest dollar daily purchases, then automatically invests those rounded up cents into a diversified portfolio, leaving knowing what to invest in up to the professionals. You can choose from five portfolio options ranging from conservative to aggressive. I invest in the latter because I think I’m still young (or so I tell myself!) and have time to rebuild my finances if something goes wrong.
What I like about Acorns is that most excuses you might have that would prevent you from investing in the stock market are removed: there are no high fees (it only costs $1.25/month if your portfolio is worth less than $5,000), you don’t need to ‘buy in’ with big money and you don’t need experience.
I’ve had it for six months now and have earned a 10% return – not too bad for following the guidance of professionals and being diligent about investing!
Disclaimer – the share market can also go the other way! Its pretty fun to open my app every now and then and see how my portfolio is working for me 🙂