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7 Tips Investing Philippine Stock Market

7 Tips Investing Philippine Stock Market

Seven tips you must remember in investing in the Philippine stock market. Are you wondering if the stock market is the right investment for you? Do you have friends that talk about it a lot and you want to get into it too? Or do you already want to invest in stocks but you’re scared if it’s the right move for you? In this blog post, you’re going to learn the seven tips you must remember in order to become a successful stock market investor and this will tell you if you’re ready for the stock market.

Take note with this blog post isn’t going to be about the requirements and documents to create a stock market account because anyone can fill out the forms, deposit some money, and you know they can invest in the stock market, but how to be a successful stock market investor. That’s what this blog post is all about.

Investing is a high-level of skin in the game of wealth. This doesn’t mean that investing is difficult to do. It simply means that you will have to develop a lot of other money skills before you start investing. And if you try investing without these, more basic skills than investing could be very difficult, unsustainable, or even impossible for you.

So in this blog post, we’re going to zoom out from the stock market and look at the big picture of your path to wealth. So whether you’re only starting or have been investing for a very long time already, this article can serve as your checklist if you can embark able to build a good foundation for your investments. With that said, let’s get started.

Here Are The 7 Tips Investing Philippine Stock Market

1. Have A Proper Wealth Mindset

Mindset is all about your personal beliefs when it comes to wealth. Do you think you deserve to be wealthy? Is money important enough for you to study it? Are you afraid of having too much money? People have many different beliefs about money, but the most relevant when it comes to stock market investing is this.

money mindeset

The belief that becoming wealthy through investing takes time. And a lot of patients, the stock market isn’t a place where you can get rich quick and get rich easily. The stock market is a slow, but sure way to wealth, so investing in stocks for a year or for two years will not change your life.

It is possible that you will see big results only in your 10th year or even your 20th year of investing. This is the proper investing mindset.

2. Have A Good And Stable Source Of Income

We get a lot of questions saying, I want to invest, but I don’t have money or the money I have isn’t enough. Well, here’s the sad part. What can you invest if you don’t have any income? Let’s get real. If you don’t have any income source or if you think your income is still too low, then your best move is to focus on increasing your income instead of studying the stock market.

Remember that investing can only multiply what you have. If you multiply zero with 1 million, you’ll still get zero. So if you have zero income or very little income right now, work on ways to add to your wealth first, like getting a job, even if it’s part-time or learning new skills so you can get a better job or maybe starting a business.

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So it’s a really bad move to invest in stocks. If you don’t have any stable source of income yet, it’s an even more stupid move to borrow money to invest in stocks just for the sake of having a tag and consider yourself as an investor, so please don’t do that. You need to have a steady source of income first before you start investing in stocks.

3. Have A Budget That You Strictly Follow

Sticking to your budget is a prerequisite if you want to start investing, because if you don’t know how to budget well, you won’t know how to save. And if you don’t know how to save, it’s impossible for you to invest. If you already have an income, but nothing is left at the end of the month for investing than the money skill you should start with is called budgeting.

You can start by simply listing down all your expenses for the next 30 days. Even if it’s a small or big amount and this will be a good basis on the estimates of your expenses. From there, you will already gain some perspective on where your money is really going.

Now if you already have a budget but you’re unable to follow it, then the trick is to divide the money in advance. Right from when you received your salary. Yup. Divide your money at the start, not at the end when all your money had already gone out.

So just from the start, allocate your money already and even better transfer the money through your different accounts. You can use jars, envelopes where you physically divide the money. The important part is it’s already subdivided prior to its use.

4. Know Your Limits To How Much You Give To Friends, Relatives, And Charity

Investing

We Filipinos love to help others, but sometimes we have to limit how much to give to some people because they can be financial sinkholes, meaning no matter how much money you give to them, they will always, always, always need more help.

So the skill to learn here is being able to say no to people who want and ask for your money.

5. Have Savings Were Three To Six Times To Your Monthly Expenses

The only thing you can predict about life is that it’s unpredictable. You can suddenly lose your job, you can get into an accident. Of course, we don’t want these things to happen, but there’s always a chance that it does happen.

successful stock market investor

So having three to six months savings will serve as a fence that protects your investment portfolio. It acts as a financial buffer, so even if bad things happen, your investments can grow at peace and you won’t need to touch it.

6. Know The Risks You Face And Have The Appropriate Insurance Coverage

Some events in life are just unbearable for anyone to save for. For events like getting critically ill, like having a heart attack or your house catching on fire or getting into a major car accident for these things, having three to six months worth of savings isn’t enough.

stable source of income

You need to have appropriate insurance coverage, your healthcare insurance, your life insurance, your auto insurance, your home insurance and so on and so forth. Insurance is another buffer for your investment portfolio.

Also Check: How To Start Investing In The Philippines Stock Market

Now if you’re wondering why do you need insurance before you can invest? Again, you don’t really need insurance to get started, but if you want to truly grow your money, then protecting it is very important and that’s what insurance is.

7. Know Your Personal Financial Goals And Appropriate Investments For Those Goals

There are no perfect investments. Even, we won’t say that the stock market is the best investment ever because that would just be wrong. There are only the best investments according to your specific goals. Now, in the case of the stock market, it is perfect for your goals 10 years or more into the future.

successful stock market investor

Usually, this is for your retirement or your children’s college education or for a 40th wedding anniversary. You know things that are going to happen 10 years from now or further from that. The stock market is the perfect place to grow your money over the long term, anything shorter than 10 years, it’s not good anymore.

And for your goals that are coming up within the year or within one, two years, then the stock market is a horrible investment. This is what it means to choose investments that are aligned with your specific financial goals

So there you have it, the seven things that will enable you to build a solid financial foundation for stock market investing. So how did you do? If you already have and know these seven things, then congratulations, you’re perfectly fit to start investing in the stock market.

Yhong Lacson

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