I get this question all the time, “I’m 16 years old and I want to get into the stock market. I want to trade stocks, but I don’t know where to start…”
If you’re a teenager looking to get into the stock market, there are likely two reasons behind your interest.
Make a Living Trading Stocks
You might be interested in making a living from trading stocks full-time.
What does full-time mean? Do you want to trade for 2-3 months out of the year or do you want to be more active in the market?
With either scenario, you need to understand what’s happening in the market and study the material. You can take your money and invest in the market right away, but your best bet is to use your money and invest in your education (especially if you’re 16-18 years old)…
I don’t mean education in terms of high school, college, or a degree. I mean investing time and money into learning the stock market. Buy the books, buy the videos, and attend seminars and workshops on the stock market.
For these things, you’re investing your time, money, and energy into your education of the stock market. I would follow these processes for a few years before you even make a trade. At least don’t make any excessive trades until you have more understanding of the stock market.
My stock market education material is above, but you don’t have to purchase my material. Go to the library, get some free material, learn through social interaction, etc. With some education, you can better see what stock market direction you want to go in.
Make Extra Income
You also could be interested in recouping losses from inflation or investing money for your retirement fund. If you’re interested in trading stocks on the side, your best bet is to invest your money in a life cycle fund…
A life cycle fund will adjust your risk profile, buy stocks for you, and automatically change over time. For example, if you have 30 years until retirement, your early investments would be very aggressive and become more stable as you near retirement.
It may not be as fun toward the end, but it will be stable – which is what you want as you age and near retirement.