This is a question we get fairly frequently and our answer is usually yes (assuming you have an emergency fund set aside, your debt is paid off, etc.), so hear us out on this one.
Invest early and often
While we should strive to “buy low, sell high,” nobody can actually predict the market. We do know that the stock market has historically trended upward, gaining about 9% on average annually. With the information that we have, the best we can do is invest as early as possible to take advantage of compound interest.
We recommend investing consistently over time, taking into account many factors such as your financial goals, risk tolerance, and time-horizon. If you’re particularly nervous about market fluctuations, you can use the strategy of dollar cost averaging. This means to spread out your stock or fund purchases by buying at regular intervals so in effect you’re smoothing out the price at which you buy.
Invest holistically
What we’ve found and what works for us and our clients is to invest as early and as much as possible while taking into consideration that we are investing holistically. What does investing holistically mean to us? It means creating a financial and investment plan based on what you want out of life and adjusting it as needed. Are there specific financial goals you are looking to accomplish, like buying a house or starting a business? Are there other life goals you are looking to accomplish such as feeling at peace with your money, being financially free, or having a healthy relationship with the societal construct that is money? These are the things that we are taking into account when we invest for you. We’re not looking to make a quick buck here or there. We’re investing for the holistic you, the you that you are cultivating and growing.
Invest sustainably
One other thing if you’re looking to get started with investing - we would highly recommend you invest sustainably. This strategy is not only beneficial for your portfolio since ESG funds have been outperforming conventional funds, but you would also be aligning your money with your values, supporting companies you believe in and companies that have your back. You can learn more about what sustainable investing is and how to do it on our blog.
To sum up, invest early and often. Try not to overthink things (obviously way easier said than done). And don’t get caught up on each and every market fluctuation. Remember to look at the big picture and follow your financial and investment plan.
