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23 Reasons Why You Should Invest in Stocks

Post on: 11 Июль, 2015 No Comment

Despite the economy’s ups and downs, the stock market has consistently proven to be a good place to invest your disposable cash and save for your future (as long as you can withstand the bumps and plan for the long term). The popularity of online brokerages can attest to the demand for access to stocks in a do-it-yourself society.

But some of us may need a little push before taking the plunge, since the stock market can be risky if you don’t know what you’re doing. Whether you want to take on DIY investing or lean on a financial advisor, CreditDonkey is laying out the reasons why you should consider investing in stocks.

Why Invest

The fact is your savings won’t do much of anything if you leave it in a very low-interest bearing account. Not dabbling in the market in some capacity would make any lofty goal of ever owning a house, gifting an education to your own children, or saving for retirement hard if not impossible, unless you are rich already.

You want to buy a house

You want to save for retirement

You want to save for your children’s college education

Why Stocks

You don’t have to suddenly become a CNBC addict or an expert on certain companies to invest in the stock market. If you have a 401(k) or you’ve had a 529 plan, you have taken part in America’s proven way for getting the best potential for long-term growth from your hard-earned cash.

Best Potential for Growth. Yes, the market has had its downs (especially in recent memory), but over time, you are poised to get more back from your investment in stocks than you would with corporate bonds, commodities, or treasury notes. From a historic standpoint, stocks have provided nearly 10% over the long term, but U.S. Treasurys have given back just around 5%.

Asset Allocation. Why bother messing with an investment that can be volatile? The key is to control the volatility as much as you can. This means diversifying where you put your money. You may still want to have some bond holdings and some less risky options, including a money market account, but you don’t want to put all your money in any one spot.

Advantage of Time. The key to all this is “long term.” If you’re nearing retirement age, you need to pull back on the riskier investment options. But if you have time on your side, you can likely withstand the riskier investments and ride the ups and downs that are going to happen. The hard truth of investing is that you can’t get big returns without big risks.

Need more than the premise of history being on your side for investing in the stock market? Read on for our 23 reasons to take a leap into the stock market.

1. IT’S NOT 2006

Yes, we know the market crashed in 2007, but had you invested all your hard-earned money in 2006, you’d be singing the blues a year later. Times have changed, the economy is on an upswing, and Borat is just a movie from the past.