How to invest: How do I start?


This post is inspired by a reader’s question in my last post How I took my revenge on BDO. She asked me what most of you may have in mind. “How do I start investing?”

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Well, it’s easy actually. Just open an account with BPI Trade or COL Financial, buy your first stocks, and voila, you’re an investor.

Wrong! Being an investor is more than just owning stocks. It entails financial education, discipline and patience.

Here are some ways you can prep up yourself for investing.

Begin by acquiring an Investor’s Mindset

“All things are created twice; first mentally; then physically.  The key to creativity is to begin with the end in mind, with a vision and a blue print of the desired result”-Stephen Covey

As in other things, your investments are created in your mind first. Read financial books, attend financial seminars or read financial blogs.  Then when you have the mind of an investor, start acting on the physical aspect.

Think Long Term

I remember that at one point, the price per share of BDO went down to 72. At that time, the average price of the stocks I bought was at 84. It could be scary. I could have sold my shares at a loss and gave up on investing forever. But because I knew that BDO is a good company, with a great possibility of earning in the long term, I instead bought more shares, hence, the final average cost of my investment went down to 79. I later on sold them at 107 per share. (Read the story here.)

Start with small amounts

I started investing in the stock market with only 600 pesos. Before I knew it, my money grew to 3000, 5000, 11000, etc. Starting small makes investing almost mindless. It makes investing lighter especially for a starting investor, those who just got their first job, or those who are investing out of their allowances.

Make Investing a Habit

Investing is not a one time big time deal. It is continuous and should be done regularly. Over time, your small amounts will accumulate. And soon enough, you’ll reap the rewards.

One last thing

There’s no shortcut in investing. It takes hard work, effort and constantly educating yourself. In the end, it’s all up to you to get your home work done. After all, it’s your personal finance. 🙂

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Photo credit: Kasahasa

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