Stock Market Investing for Beginners: The Essential Guide to Smart Stock Investing by Matthew Newell

Chapter 1: All About Investing
Investing successfully is all about working smarter as opposed to harder.
Rather than working long hours and sacrificing personal happiness to sock
money away in a savings account, it is about taking that money and using it
to potentially build a better life in the long run through a maximization of
profits earn. Investing successfully is also about setting priorities for your
money and the returns it will generate. Spending is easy to do and provides
instant gratification and short-term satisfaction. On the other hand,
investing is all about delayed gratification and making life better in the
long-term.
Okay, so why should you invest your money? If you already have that
money, why risk losing it? Well, there are two things that can happen when
you make an investment: You can lose your money, but you can also make
more money. Of course, as an investor, your goal is to continuously make
profits.
Making an investment is the way to earn financial freedom. Imagine being
able to multiply your money by more than 500 times or even more than
5,000 times its value. The possibilities are endless. Of course, this will
depend on where you put your money in, as well as being able to make the
right investment decisions.
So, whether you just want to increase your income or if you dream as high
as of attaining financial freedom, then you should definitely consider
making an investment.
If you come to think about it, money moves. The value of money increases
over time only if you know how to use it properly. No wonder there are
many businesses around you. And, if you look closer, you will see that all
these businesses are run by the same force: money. When you learn to
invest effectively and successfully, you will know how you can make
money to work for you instead of beating yourself for long hours just to
earn a living. This time, you take control over money, just as the way it
should be.
Saving versus investing: One of the most important things to understand
before you begin building wealth is the difference between investing and
saving money. Let’s go into what each of them is and look at the benefits
and drawbacks of each. Then we will outline how to do both effectively.
Saving money is the very first thing you’ll want to focus on in your
financial plan. Saving is putting money away and not touching it unless you
really need to. The point is not to make a profit using your savings. Rather,
it’s about ensuring that you have an emergency fund for when you need it.
You want to put cash in a bank account, or under your mattress and just
leave it. Almost all wealthy investors recommend holding onto a chunk of
cash and keeping it in a place where no one else can find it. The logic
behind this is that if the market collapses, you’ll have cash on hand to get
you through. Apparently, during a big financial crisis in the recent past,
some of the top investors called their wives and instructed them to take out
as much money as they could from bank machines as soon as possible. The
market was crashing, and they didn’t know if they would have anything in
their personal accounts if they waited until the end of the day to go to the
bank themselves.
It is wise for everyone to establish a nest egg or emergency fund with
between three- and six-months’ worth of living expenses that they can
access immediately. Investments take at least several days to liquidate, so

Stock Market Investing for Beginners: The Essential Guide to Smart Stock Investing by Matthew Newell