What do you wish you'd known about investing?

TypicalVillain

I'm curious about the lessons people have learned over the years. For me, the biggest lessons I've learned are:

1) I can't time the market
2) There's always a little money to put away

The main thing about (2) is that for years I thought I had no money to invest or save, but the reality is that I went out to eat plenty of times, traveled a bit, etc. There was always SOME money, it was just disappearing without thought. So my advice is to start setting up automatic monthly transfers to saving accounts. I use Vanguard and so I can invest even very small amounts per month. It's awesome!

What about you? Interesting lessons you've learned?

InvestInPoker

TypicalVillain wrote: »

What about you? Interesting lessons you've learned?

I wish I had looked into it long before I originally did. My biggest mistake is being underinvested in the past. Nothing I can do about that now.

chucknorris

TypicalVillain wrote: »

I'm curious about the lessons people have learned over the years. For me, the biggest lessons I've learned are:

1) I can't time the market
2) There's always a little money to put away

The main thing about (2) is that for years I thought I had no money to invest or save, but the reality is that I went out to eat plenty of times, traveled a bit, etc. There was always SOME money, it was just disappearing without thought. So my advice is to start setting up automatic monthly transfers to saving accounts. I use Vanguard and so I can invest even very small amounts per month. It's awesome!


What about you? Interesting lessons you've learned?

Not rocket science, and the only reason that I didn't appreciate it far sooner was that I was so focused on building up my property portfolio. But it was only a few years ago that I started investing in a SIPP and also realised the tax advantage of (non ISA/SIPP) dividend income (effective rate of only 25% to higher rate tax payers).

TypicalVillain

InvestInPoker wrote: »

I wish I had looked into it long before I originally did. My biggest mistake is being underinvested in the past. Nothing I can do about that now.

Oh yeah - me too! Lost about 5 years due to that. Ah well. Better late than never! Plus now we are "enlightened" so we can spread the word to our friends that never save :-)

BLB53

Oh Dear, where do I start!

I suppose not really understanding what I was doing would have been the biggest mistake. I should have taken more time to research the basics but instead I was lead by the nose with seductive ads from all the fund managers and financial media stories.

Also, I did not understand the importance of compound returns on equities - I kept too much money is 'safe' cash deposit accounts which lost their value over the years with inflation.

Interesting article on diy investor this week along the same theme http://www.diyinvestoruk.blogspot.co.uk/2015/03/investing-notes-to-my-21-yr-old-self.html

kidmugsy

If young enough: invest whenever you have spare cash, and equities aren't lousy value. Sell when equities have been going bananas for some time after people first pointed it out. As soon as they are non-lousy, start investing again. Don't wait for the bottom: you won't know it when you see it anyway.

enthusiasticsaver

I am new to investing and wish I had looked into it years ago and started putting even a small amount away. I focussed on buying property with my husband, paying off the mortgage early, saving cash for holidays and to set our children up with university, help with cars and first houses etc. We are now looking retirement in the face and have started to look at investing. We always had our pensions though so I guess we did not ignore it completely.


I am sure however that I will make many mistakes in the first few years and I think the one I am being drawn into at the moment is listening to everyone and anybody's advice and not having a proper investment strategy. I do not yet have the knowledge to filter out what is good and what is bad advice.

racing_blue

Yes, that's it for me too. Having a strategy and keeping it simple. If I could send instructions back in time to the 25 year old me, it would be something like:

Always, always invest x% of salary every month before spending anything else. Plan your lifestyle so that this is possible.

Pick an asset allocation and stick with it. 50% stocks and 50% bonds is a good starting point.

Make low cost index funds the bedrock, but don't be afraid to take some risks on individual companies. Look at how the world is changing around you, imagine the future. If 6 times out of 10 you land on a ladder, and 4 times out of 10 a snake, you will still do OK.

Oh... ditch the mullet.

Tammy2

That there were monthly saving plans that allow modest investments. I'd have started a lot earlier.

gadgetmind

My top ones are -

1) Start early
2) Dig deep
3) Diversify widely
4) Cut out middlemen, and thus fees, as much as possible.
5) Review and rebalance once a year.

MadMat

My biggest mistake - not listening to my mum when I got my first job at 16 - "pay your bills, then spend half and save half of whats left" she said!

I of course blew the lot on cars girls and beer - and wasted the rest!

Mat