What I’ve Learned Investing as a 19-Year-Old

Starting my investing journey early was one of the best decisions I’ve made. I began investing after losing my job, hoping to make some extra money while searching for another. Of course, I didn’t see profits right away, but patience has been a key factor in my success.

Through my experience, I’ve learned some important lessons – like why time in the market matters, how powerful compound interest can be, and, most importantly, what not to do. Hopefully, my journey can help you navigate yours a little easier!

1. You Don’t Need a Lot of Money to Start

One of the biggest myths I’ve heard is that only the rich can profit from investing. Sure, the more you put in, the greater the returns – but anyone can benefit from investing, as long as you make smart choices (and get a little lucky!).

You don’t need thousands of dollars to get started. I began by investing about 10% of every paycheque into various assets, which I’ll talk about later. At the time, I was only making minimum wage, so it felt like a big commitment – but it’s been more than worth it. Even now, without a job, I still invest $150 every month.

No matter how much you start with, those amounts add up. Even just $50 a month turns into $600 by the end of the year. And with the market’s long-term growth, even small investments can lead to big gains over time!

2. The Power of Compound Interest

Even though I’m only 19, I still wish I had started investing even sooner to take full advantage of compound interest. Understanding how it works is key to making smart investment decisions.

The best way it was explained to me is that compound interest is essentially interest earned on interest. This means that the returns from your original investment get reinvested, growing at the same interest rate year after year.

For example, if you invested $100 at a 5% annual interest rate, by the end of the year, it would grow to $105. If you reinvested that $105 at the same 5% rate, you’d have $110.25 by the end of the next year. Over time, your investments keep building on themselves, creating a snowball effect.

The longer you stay invested, the more powerful compound interest becomes. And if you continue adding more to your investments along the way, your returns will grow even faster!

3. It’s Not About Timing the Market, But Time In the Market

First-time investors often believe they need to wait for stocks to drop super low before buying in order to see any real profit. But that’s not necessarily true. While it’s important to avoid buying assets at their peak – especially if they’ve suddenly skyrocketed – trying to predict the perfect time to buy and sell is risky and unreliable.

Instead, focus on finding solid investments – whether they’re steady, slowly climbing, or something you genuinely believe in – and start investing consistently. Rather than dumping all your money in at once, it’s smarter to invest smaller amounts over time.

For example, let’s say the asset you’re interested in is $50 per share when you first invest. Instead of buying a full share right away and worrying about price fluctuations, you could invest $5 every few days, no matter the price of the asset. This strategy, called dollar-cost averaging, helps lower your average cost per share over time and reduces the impact of short-term market swings.

This method works best for long-term investments, but if you stay consistent (and, of course, get a little lucky), it can pay off in the long run!

4. Mistakes I Made and What I’d Do Differently

Even though I started off investing slowly, I still made some mistakes along the way. One of the worst things you can do is throw your money into an asset without knowing anything about it, hoping for big results. Unfortunately, I learned this the hard way.

On my first day investing, I put money into cryptocurrency without doing any research. At the time, I had no real knowledge of investing or the coins I was putting my hard-earned money into. Almost immediately, my investment started dropping. I panicked, sold my coins, and took a loss.

Looking back, I made two major mistakes – ones that many beginners make:

1. Not researching assets before buying in. Just because something looks promising at first doesn’t mean it’s a good investment. Before buying, you need to look at factors like performance history, popularity, and long-term potential. Never go in blind!

2. Letting emotions take over and selling too quickly. You’re never going to be in profit 100% of the time. Losses are part of the game, and learning to manage emotions is crucial. If you sell at every small dip, you’ll miss out on potential recoveries.

That said, knowing when to cut your losses is also important. If a market crash or a sharp decline happens, you need to assess whether holding is still the right move. But in general, the longer your money stays invested, the better chance you have at success – just like I mentioned in my last point!

5. Best Beginner-Friendly Investing Strategies (Optional, but helpful!)

Looking back, starting my investing journey by buying random cryptocurrencies wasn’t the best idea. If I were to start again, I’d probably begin by slowly investing in an index fund.

Index funds are portfolios that contain shares in multiple companies, bonds, and other assets. They’re a great starting point because they’re low-risk and don’t require as much research as individual stocks. That said, it’s still a good idea to understand what you’re investing in. While index funds may not have the massive short-term gains that some individual stocks or cryptocurrencies do, they’re a much safer long-term choice.

If you’re willing to do more research, individual stocks and cryptocurrencies can have big payoffs – if you pick the right ones. But your best bet is to diversify your portfolio by investing in multiple assets rather than putting all your money into one thing. Spreading out your investments reduces risk and increases your chances of long-term success.

Another key strategy I’d recommend – just like I mentioned before – is to stay consistent with your investments and let your assets grow over time. That doesn’t mean you should just dump your money in and forget about it. You should still check your portfolio regularly to monitor potential gains and losses, but unless you’re facing a major downturn, it’s usually best to leave your investments alone and let them reach their full potential!

Starting my investing journey at 19 has been a learning experience, and while I’ve made mistakes, I’ve also gained valuable insights along the way. The biggest lessons? You don’t need a lot of money to start, time in the market matters more than timing the market, and patience is key. Compound interest is a powerful tool, and consistency – whether through index funds, individual stocks, or other assets – can make all the difference in long-term success.

If you’re new to investing, don’t be afraid to start small, do your research, and stay committed. The earlier you begin, the more time your money has to grow. Investing might seem intimidating at first, but with the right mindset and strategies, it can set you up for a more secure financial future.

What’s one thing you’ve learned about investing so far? Let me know – I’d love to hear your thoughts!