The Seven Steps To Start Investing

Investing is one of the best ways to grow your long-term wealth. But before you start buying stocks, there are a few steps you need to take… 

So you’ve decided to invest. Congratulations!

You’ve made one of the best financial decisions of your life. Long-term investing has been consistently proven as the most efficient way to grow your wealth. In fact, it’s been mathematically determined that the probability of losing money after applying the ‘Invest Early and Invest Often’ philosophy over 20 years is 0.066%.

Those are pretty attractive odds!

But before you dive in and begin to invest in stock, there are a few things you should do to help you get the best start possible…

1. Get Your Debt Under Control

calculator-385506_1280.jpgOne of the main rules we have at Rubicoin is that you should never borrow money to buy stocks. In order to grow your long-term wealth in a sustainable way, it’s vital that you don’t spend what you can’t afford.

So before you start investing, you need to get your own accounts in order first. You don’t need to be completely debt-free, but small actions like putting a budget in place and tracking your expenses every month will help you to make sure that any outstanding debts you might have are under control.

Remember, investing is a long-term pursuit. To grow your wealth, you need to keep your money invested in stocks for the next 5-10 years at least. If you are constantly removing money from investments to pay off debts, any profits you make will be eaten up by taxes and charges.

2. Start Saving


“You should save at least 10% of your salary every month!”

Everybody has probably heard something like this a couple of times throughout their life from parents, teachers, friends—maybe even a financial advisor. It’s certainly a nice goal to set for yourself, but regularly putting 10% of your income into a savings account is nothing more than a pipe dream for a lot of people.

The bad news is that you do need to start putting money aside before you start investing. The good news is that these savings don’t need to be anywhere near as much as 10%. In fact, we think that you should start by putting as little as 1% of your salary aside in savings every month. It might not sound like much, but the important thing is that you’re creating the habit of regularly saving a small portion of your money that can then go into investments.

In the future, as your salary increases or your circumstances change, you might be able to start siphoning a larger percentage into your investments. But to start out, 1% is all it takes!

3. Build An Emergency Fund

fire-detectors-502893_640.jpgAs much as we’d like to think otherwise, it’s a simple fact of life that you can never tell what’s around the corner. But what you can do is have an emergency fund put aside to help you prepare better for all of those unexpected events.

This emergency fund can’t double as investments in the stock market, unfortunately. You might need to access it immediately at some stage in the future and you don’t want to have to sell your investments in the middle of a downturn. Therefore, the best place for these funds is either in a traditional savings account or a money market fund.

4. Download the Learn App

Before you start investing in some of your favorite companies through our Invest app, why not download our free Learn app and brush up on some of the basics?

Learn is an educational tool for iOS and Android that is intended to help you invest with confidence. Following an easy to read chapter structure which you can mark off as you go, Learn has been designed by our CEO and Chief Investment Officer Emmet Savage to impart all the basics of investing and the stock market to novice investors. Each lesson also includes an audio track, which means that you can also learn on the go.

Learn has received some glowing reviews from both new and experienced investors. Try it out for yourself!

5. Find Companies You Admire

shopping.jpegYou might not believe it, but you already know a lot more about the stock market than you might think.

Are you reading this an Apple cellphone? Are you drinking one of the hundreds of beverages in Coca-Cola’s brand portfolio? Maybe you’re wearing Under Armour, Nike, or Lululemon clothing that was ordered from Amazon and paid for via PayPal? Have you eaten in Chipotle, Chuy’s, Texas Roadhouse, or Panera Bread lately?

All of these, plus many more, are companies that you can invest in.

Identifying potential stock investments can be as easy as taking a look around you and finding some companies that you admire. This is called a consumer edge. If you’re going to invest in a company long-term, it’s important that you have an in-depth knowledge of what the company does, how they do it, and how they plan to keep doing it in the future.

6. Set Up Your Brokerage Account


Thanks to movies like ‘The Wolf of Wall Street’, most people think of stock brokers as shady guys in bad suits that are out to get your money. In reality, modern stockbrokers are nothing more than a necessary link between an investor and the stock market. In order to invest, you have to have a brokerage account with a licensed stockbroker who will buy and sell stocks on your behalf.

Rubicoin has partnered with DriveWealth to help our customers set up and fund their own brokerage account directly through our Invest app. Brokerage with DriveWealth offers competitive fees and allows you access to the U.S. stock market from more than 140 countries across the world.

7. Buy Your First Share


Once you’ve set up and funded your brokerage account, you’re ready to buy your first share!

Remember, the key to long-term success is a diversified portfolio. You don’t want to put all your investments into one company or even one industry. One of the best things about investing is that it encourages you to learn more about the world around you and keep learning. Take it as an opportunity to expand your own knowledge base while simultaneously taking control of your own financial future.

Stay informed, add a little to your investments often, diversify, and—most importantly— have fun!

Rubicoin operates a full disclosure policy. Rubicoin staff currently hold long term positions in Apple, Under Armour, Nike, Amazon, Paypal, Chipotle and Chuy’s.

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