(MENAFN- EIN Presswire) First-time investors 'bull-ied' into the stock market like never before
VANCOUVER, BC, CANADA, March 31, 2021 /EINPresswire.com / -- These beginners dumped a considerable amount of time and money while stuck at home during the pandemic.The stimulus package deposited extra cash in pockets with little to spend it on. Others were just bored, with nothing to do and extra time to kill.The result was a perfect storm. Charles Schwab, an industry leader, reported that new accounts are completing more total trades than any other.And, many more are still eager to jump in.
Before beginning, accountant Konstantin Lichtenwald , based in Vancouver, encourages any first-time investor to ask themselves these five questions.
What type of investor are you?
It sounds like an existential crisis, but it all starts with self-reflection.
Who are you?
You may want to dive right in. You're hands-on and want to manage every step of the process. Or, researching stocks and prices may feel like a chore. It's okay to be less active in process.
This will help determine the entire approach.
Luckily, you can still invest no matter how you answer. All that changes is the 'how.'
How do you want to allocate resources?
Regardless of your appetite, there's a flavor for you.
Choosing stocks and funds on your own gives freedom and control over every aspect. Popular online brokerage apps, like Robinhood, have seen spikes from novices after the government released stimulus checks.
If DIY is a little too much, robo-advisors may be an ideal choice. Supported by most major firms, this service promotes expert help for a low-cost fee.
Consulting with a broker is always a good place to start. Konstantin Lichtenwald and other professionals offer assistance and direction where needed.
Can a professional, like Konstantin Lichtenwald, really help?
Simply put, yes.
You have the vision. They provide the game plan.
Accountants and brokers have the experience to create a personalized strategy that works for you. Konstantin Lichtenwald and other CPAs balance short-term interests with long-term goals.
How much should I invest?
Your goals are set.
Now, you need to set a budget.
Individual stock prices vary greatly, ranging from a few dollars to thousands. Selecting the right one can be tricky. As a general rule, these should be a small portion of your allocation.
Choose an exchange-traded fund (ETF) if your budget is limited. Like stocks, these trade for share prices but at fraction of the cost of traditional mutual funds.
Factor in any fees or service charges linked to whatever account you've created.
What should I invest in?
It's time to build your portfolio.
Your goals drive your decisions.
If you're padding a retirement nest egg, consider an individual retirement account (IRA). These offer tax breaks on your savings.
Konstantin Lichtenwald advises his clients to diversify and reduce risk . Don't overextend yourself and never invest in a business you don't understand.
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