When considering about investing, for example in the financial stock market, investing at the wrong time may prove to be detrimental for a young investor at that will result in huge losses right from the start. Timing is crucial in the stock market as the market continually swings up and down and is known to be very volatile. Just like the stock market, timing is everything when you are considering about investing in any business. In late 2017, crypto currencies like Bitcoin jumped almost 250% in value right before Christmas and stayed at that position for a few weeks before gradually plummeting in value ever since early 2018 and now it is sitting at a fraction of the value it once enjoyed. The people who sold off their Bitcoin during the initial jump are the real winners whereas people who decided to hold on to their Bitcoin in the hopes that the value of it will rise more, were the losers as they had to experience substantial losses in their portfolio.
This all points to the fact that time plays a crucial role for any kind of investment in business. You have to enough when is the ideal time to invest in a particular business and when is the correct time to pull out your investment. Just like that, if you start investing at a later stage in life rather than investing at an early age, you would miss out on a lot of things and your chances of success will decrease substantially. Investing at an early age allows you to test your credentials and gain experience of winning and losing money so that as you grow older, you can grow wiser and use your experience to keep away from investing at wrong places at the wrong time.
Investing at a young age also means that you will start saving more money and realize the value and importance of money from an early age of your life. You would be able to see that investing more money into a profitable business will allow you to double your money and that putting money in bank accounts is nothing but a waste of time.
Once you are ready to invest in business, make sure that you are investing in a company that has a sound business plan. Many of us jump at the hype and follow the latest trends, but more often than not, trends have a tendency to go bust after the hype dies down. Never invest in anything that sounds too good to be true. Young people are often duped into investing in whacky companies which promise a lot of returns but end up running away with your money due to having an unsustainable business plan. This is why it is better to practice your better judgment while investing money. Investing in low risk schemes are a good way to start out as your chances of making a profit from your investments are higher than investing in a high risk scheme.
Never wait till your retirement age to start investing. If you are too pessimistic about making an investment, consider putting your money into mutual funds like the 401k where the interest rates are higher than a conventional savings account of banks. The interest rates offered on savings accounts are lower and considering the inflation rate, your money grows smaller rather than increase in value due to the rising cost of living. So, in order to beat the inflation and have a comfortable living situation, it is paramount that we start investing at a young age and not just rely on our jobs to make a living.