I’m here to ask you a favor: Please promise you will never listen to this type of advice: “You need to be rich or have a lot of money start investing and saving.” This is just one of the worst pieces of advice anyone can give you and there is a misconception around this.
If someone had told me that when I was 23 and putting away as much as I could from each paycheck (and it was very small amounts at first), I’m not sure I would be sitting here writing to 2.7 million Stash subscribers.
The reason we started Stash was to help people learn and invest. Before we launched we asked hundreds of people how much money they thought they needed to start and everyone had a similar answer: “I don’t know — but I’m pretty sure you have to be rich.”
This thinking has been ingrained in people because Wall Street caters mainly to the wealthy. And Wall Street’s incentives don’t always align with the average American who is just trying to pay their bills every month.
Don’t ever let anyone say you can’t be an investor because you don’t have the money to do it. We dropped the minimum to $5 so that anyone could start investing. $5 may not seem like much. But it’s a place to start and learn. Saving a little bit of money on a regular basis adds up. And it makes a lot more sense (and is a lot less risky) than waiting for the day when you have a lump sum to put in the market.
Why is investing small amounts over time a better idea than putting in a big chunk on a single day?
Because you won’t need to time the market, which is a fool’s errand. Putting in whatever you can afford every week is the best strategy because you’ll buy some when the market is up and some more when the market is down – giving you the average – which has worked well for investors over the last 30 years.
There’s always that person out there who wants to give you advice because they think they know better or have more money than you. As a self-made, native New Yorker and the CEO of Stash, I want to reassure you — you are doing exactly the right things: learning, investing and building wealth for yourself.
~86% of Stashers are first-time investors.* Every investor was once a beginner investor. We all have to start somewhere. The world has changed and investing isn’t just for the rich anymore.
It doesn’t matter how much money you have or how much your dividends are right now. Over time, small amounts of money grow to bigger amounts. That’s the nature (and power) of compounding. Pennies become dollars. Two digits become three and then four. It’s not magic — it’s patience and a sound strategy.
It doesn’t matter how much you get paid or what your net worth is. You are taking the right steps to build your Stash. Think long-term and keep it growing. And remember, it’s never too late to start.
Keep it up. You are our heroes.
*Source: Stash Financial Literacy Survey, February 2017