First-Time Investor? Here Are 9 Mistakes You Want To Avoid Investing is one of the best ways to build wealth and secure your financial freedom as you get older, especially post-retirement. But if you're looking to get into the investment...

Investing is one of the best ways to build wealth and secure your financial freedom as you get older, especially post-retirement. But if you're looking to get into the investment game now, you need to beware of certain investing mistakes that are easy for first-time investors to make.

Read on for 9 beginner investing mistakes to avoid.

Investing Without a Plan

First and foremost, investing without a plan is never a good idea, even if you receive a 100% guaranteed profitable stock investing tip from a friend or financial expert. When you put money into the market, you need to know:

• What is the purpose of that money
• When you'll take the money out ("take profit")

For example, if you are investing for retirement, you should have retirement investment goals and immediately take money out of the market when you hit those goals. The sooner you have an investment plan, the sooner you can make wise decisions for your portfolio.

Buying Without Research

Similarly, you should never purchase a stock, ETF (exchange-traded fund), or another market instrument without extensive research beforehand. If you don't know what to look for, rely on the advice of a financial advisor who has already done the research for stocks and the market at large and who can make good decisions based on your financial goals and existing savings.

Misunderstanding Investing Fees

It's also a mistake to misunderstand investment fees. When you invest your money in the stock market, you'll use an investing platform like Fidelity, Due, or something else. Many of these platforms charge minor fees, but that's not necessarily a bad thing!

In fact, as a first-time investor, it's often beneficial to spend $10 or more to get the help and advice of financial advisors so you don't move your money around unwisely. Don't think of investing fees as always bad news. Sometimes, they're necessary to make the most of the stock market.

Chasing Trends

Never chase temporary, hot-button trends when it comes to investing. Those trends might appear attractive and potentially profitable, but they are impossible to predict by nature. If you're unlucky, you could put a lot of money into a trending stock, only for that stock's value to decrease the next day, causing you to lose a lot of money.

Watching the Market 24/7

You'll drive yourself crazy if you watch the stock market and its endless arrays of charts, lines, and bar graphs 24/7. It's much better to invest your money and then move on to something else. Check the market every day or week, depending on your goals and the kinds of investments you've made. But don't spend all your time and attention on the market, or you'll become impatient and potentially make other first-time investing mistakes.

Following Dubious Advice

There's a lot of bad investing advice on the internet, particularly on social media sites, posted by "gurus" who claim to know the secrets to making tons of money. In truth, the best advice isn't free or readily shared on Facebook. Try to avoid following dubious advice from people you don't know or trust, especially those advisors with no real-world credentials to back up their claims.

Investing Money You Don't Have

When you invest in the market, only put the money you can afford to lose in stocks, bonds, or other assets. For example, if you've been saving up to buy a home, resist the urge to invest that money anywhere until you're ready to buy your property. Even in the best cases, no one can predict how the market will turn with 100% certainty. Investing money you may need elsewhere soon could jeopardize your financial future or harm your ability to make mortgage payments and cover other essential living expenses.

Developing Company Loyalty

From time to time, you might become emotionally attached to a specific company and may want to purchase its stocks for reasons other than making money. This is a beginner's mistake.

It's much wiser to avoid developing any loyalty for companies you invest in. At the end of the day, they're businesses looking to make money – they have the same goal as you do. The company doesn't have any loyalty to you, so you should feel no qualms about selling your stocks or other assets in those companies in favor of different investments if the price is right.

Delaying Investing

One of the biggest mistakes you can make as a first-time investor is delaying investing. The earlier you put money in the market, even if it's in a slow-growth, low-risk mutual fund, the more money you'll have when you retire. Putting money into the market earlier is also better if you're young since any hypothetical market downturns or bear markets will likely turn back up by the time you need to withdraw your investment cash for retirement or other purposes.

The sooner you start investing, the better, so get started now, even if it's just kicking in $50 a month into a safe mutual fund.

Bonus Mistake: Being Impatient

Here's one last mistake you should avoid as a first-time investor: being impatient. When you invest money into a company or any other asset, remember that it will take time to grow in value. "Meme" stocks that catapult in value over a few days or weeks are rare, so don't let those fool you into thinking they are the norm.

Instead, it's more common for your investments to take years or decades to pay off. That's okay! The last thing you need to do is be impatient and constantly withdraw your money in pursuit of short-term riches. If you've made wise investments or are following the advice of a knowledgeable financial advisor, you can let your money sit and grow without any attention on your part.

Final Words

Investing for the first time can be exciting, but it can also be risky. Stay smart and cautious, and consider signing up for a financial advisor or retirement advisory service like Due so you can learn the ropes of smart, profitable investing.

The post First-Time Investor? Here Are 9 Mistakes You Want To Avoid appeared first on Due.