This week we’ve got a question from a viewer. A viewer writes, “Our grandson is a freshman at UT and he wants to invest in the stock market – should I be concerned?” Paul Fain, Knoxville Certified Financial Planner and President of Asset Planning Corporation, answers this interesting question about investing in the stock market this week on WBIR’s Sunday Money.
IT SEEMS NATURAL FOR A GRANDPARENT TO BE CONCERNED FOR A GRANDCHILD RIGHT?
Yes, some common concerns are:
- Lack of knowledge about the stock market
- Losing money in the stock market
- Fraud
IS THERE AN APPROPRIATE AGE TO START INVESTING?
- Start young! It is never too early to start investing.
- Get educated:
- Stocks vs. bonds vs. money funds
- Power of compounding
- Think long-term: only invest long-term money
DO MOST YOUNG PEOPLE MAKE GOOD STOCK INVESTORS?
- Can’t afford to lose (ex: student loan)
- Young people tend to be more impatient
- Speculative: get rich quick
- Hot Tip
WHAT IS YOUR ADVICE FOR A BEGINNER STOCK INVESTOR?
Use a Stock Index Fund:
- Diversified
- Low Cost
- Low Minimum
- Invest regularly
FAST MARKET FACT: Tracking top stocks in popular Stock Index Fund (23% of total)
Top 10 Holdings: S&P 500 Index Fund
- Microsoft
- Apple Inc.
- Amazon
- Alphabet
- Berkshire Hathaway
- JP Morgan
- Johnson & Johnson
- Visa Inc.
- Proctor & Gamble
QUESTION FOR OUR MONEYMAN?
Want to learn more about if you should invest in the stock market? Do you have other general questions about financial planning, investing, or retirement planning? Send your questions to our Knoxville Certified financial planner Paul Fain or directly to Paul@assetplanningcorp.com!
