Beginning to Invest

As college students, we tend to think of investing as something we might do when we get older or maybe you have never thought of it at all.  For many of us investing can be an intimidating foreign process.  Not waiting to invest can have its benefits like have extra money for buying a house or paying back student loans.

Investment basics

Security- bond or stock certificates

Bond- an interest-bearing certificate of public or private indebtedness

Stock- The ownership element in a corporation divided to give the owners an interest and usually voting power.

Mutual fund- an investment company that invests money of its shareholders in a usually diversified group of securities of other corporations.

Stockholder- one who owns corporate stock.

Stock Exchange- a place where the buying and selling of securities is conducted.

Stock Broker- One who executes orders to buy and sell securities.

Why Invest?

Investorguide.com has a “University” where people can learn how to invest.  “The idea behind investing is that money is put to use in such a way that it is likely to turn into more money.  This could happen because someone is willing to pay interest to use the money or because the value of whatever security the money was used to buy increases during the period of ownership.  Destinations for invested money include savings accounts, stocks, bonds, mutual funds and numerous other investment options,” the website says.

Getting Started

Contacting a stockbroker or trying Internet sites such as www.choosetosave.org can get you started in investing.  Many stockbrokers offer free consultations.  Generally, you should come the consultation with questions and have an idea about what you want to invest in and how much you want to invest.  It is important to set goals ahead of time.  Another good idea is to look around your job or neighborhood for investment clubs or maybe consider starting one of your own.

For new investors the key is to start small.  Do plenty of research.  If you are interested in stocks, make sure you have checked out the stock market for a couple of weeks.  Do some investigating in companies you are interested in.  In his book "Five Minute Investing," Braden Glett said, “You can never err by giving yourself time to learn something before plunging headlong into it.  It’s a fairly safe bet that if you don’t feel like you know what you are doing, then you are probably right and would be well advised to start on the conservative end of the scale.”


The Fear

“I took an econ class in high school.  We learned about investing but when it comes to real money, I would never do it,” said Janell Wright a junior at FloridaA&MUniversity.

Another Fellow FAMU student Marcus Urial was equally apprehensive, “I don’t know anything about investing,” he said, “It’s not something you see black people doing.”

In fact, many students polled felt that investing was not a typical activity in the black community.  While no studies were found to see if this widely held belief is true; do not let it stop you from investing.

The stock market is a gamble.  If you are confused or do not know what your next move should be, get help.  Remember, this is your money and your future.