By Matt Casadona
Have you ever tried to think of ways to increase your income without increasing your hours at work? Maybe you’ve been surfing Indeed for new job opportunities or preparing a presentation for your boss that covers why you deserve a raise. Let’s face it we have all tried ways to ask for a raise while showing examples of all the great work and research we have contributed to the company. The good news is you don’t need to do any of this or put in more hours at work to skyrocket your income. By investing in stocks, you can passively earn income and save up for the future. Here’s how you can skyrocket your income using stocks.
Making Money with Stocks
If you took economics in school, then you probably already know how the stock market works. It’s as simple as supply and demand, with those two factors affecting the value of stocks. As an investor, you’ll purchase assets like stocks. These stocks increase in value when the company is doing well and making financial progress. As the company continues to do well, more people will be paying for their stocks, making their stock prices rise.
If you have stock in a company and the value of those stocks rises, you can earn something when you sell it. Remember, though; it’s also possible for stocks to decrease in value.
While you can make money selling your stocks, you can also earn money through shareholder dividends. Dividends are portions of the company’s revenue that are given to shareholders. They’re typically paid out every quarter, but you can earn them as additional shares.
Now that you understand the basic premise of how investing can help you earn money, here’s how you can start making more money without putting in more time at work. And speaking of work, you might even be able to become a shareholder of the company you work for if your company offers shares as a unique employee benefit.
Be Mindful of Time
Investing is a long-term strategy. Whether you invest in crypto or stocks, you’ll need to have some patience. While you can make money in the short term, the real potential to earn comes from long-term holdings in the form of compound interest. As your stocks increase in value, you’ll have more money in your account.
However, if you want to experience growth over time, you should start building your portfolio when you’re young. You should start investing as soon as you earn an income, even if it’s just investing in an employer-sponsored retirement plan.
Even if you put only a little bit of money into your retirement account when you’re young and put nothing else into the account, you can end up with thousands of dollars after 50 years of growth, assuming a modern rate of return.
However, many people don’t want to retire in 50 years. If you’re 20 years old, you probably want to retire in 65 years, and older individuals want to retire in less than that. Saving for retirement is harder the longer you put it off, so it’s best to start investing right now, even if you can only afford to save a few hundred bucks.
If you want to make more money with stocks, then you’ll need to invest regularly.
For example, suppose you open up a retirement account, and instead of forgetting to add money every month, you decide to invest about $10 per week- hardly enough to affect your way of living. By investing regularly, you can grow your savings exponentially and make a few thousand dollars to tens of thousands of dollars by the time you retire.
Investing in stocks is the same. The more often you invest, the more money you can make in the long run.
Think Long Term
If you want to grow your portfolio and make more money, you’ll have to be patient. Short-term stock trading doesn’t have the same tax benefits you can get from holding onto your stocks and other investments for longer. If you sell a stock before your first year of owning it, you’ll end up paying higher taxes.
Not to mention, many people see the value of their stock quickly drop and decide to sell. Being impulsive is not the way to earn more money when investing in the stock market. Instead, you should be patient and wait for that stock to come back up because they typically rise after a drastic fall.
For the most part, serious dips get reversed, so there’s no reason to monitor stocks every single day unless you’re investing every single day and need to do your research. While you should monitor the stock market to make better-investing decisions, you don’t have to obsess over it.
Have Portfolio Diversity
Portfolio diversity protects you from issues that can cost you money in the stock market. All types of investments carry risk. By taking on different types of investments, you can protect yourself if the companies you invest in underperform. Make sure you invest in many different types of securities so you can weather any stock market storm. It’s unlikely that all of the companies you invest in will succeed at the same time, so it’s better to be prepared.
Ask the Professionals
The internet and apps make it easy to become an investor, but if you want to become a pro, then consider talking to an investment advisor who can help you build your portfolio. Working with an advisor won’t eliminate all of your risks, but it’ll put someone on your side that can help you better manage risk. You can also check out a Motley Fool review and see if perhaps a service like that can help you. You can also check out a Motley Fool review and see if perhaps a service like that can help you.
Investing in Stocks
Investing in stocks is easy, but you should always do your homework and research the companies that you’re interested in investing in. Something that may seem like a great opportunity because the stocks are cheap may end up costing you money in the long run. Instead of doing it alone, consider working with an advisor that can help guide you through the entire process so you can start investing wisely. You can check here what is the advantage of investing early for retirement and to know more knowledge about investing. There’s no reason to put your hard-earned money at risk when you could be earning more.
About the Author
Matt Casadona has a Bachelor of Science in Business Administration, with a concentration in Marketing and a minor in Psychology. Matt is passionate about marketing and business strategy and enjoys San Diego life, traveling, and music.