Winning the lottery is a coincidence, but investing is sure to make you rich, says the recent Raha specialty magazine. We pick out from the magazine the reasons why you should start investing too.
Investment has increased significantly in recent years, with up to a third of Finns owning investments.
– The increase in the number of female investors in particular is really significant. Also for children, it can be seen that they have now started to save by investing, says Nordnet’s financial expert Martin Paasi In Iltalehti’s Raha specialty magazine.
Although attitudes towards investing are changing, Finland still has the idea that winning the lottery is more socially acceptable than long-term investing and saving.
– Listing on the stock exchange may seem speculative in the minds of Finns. Tauno Palon even one film shows how a man enriched by speculation in stock market trading shows off and eventually loses everything, Paasi says.
According to Paas, the picture is correct when looking at the performance of short-term and speculative investors, but not with regard to long-term investing.
– The success of long-term and disciplined investment is increasingly certain, Paasi says.
1. If you don’t start, nothing will change
According to Martin Paas, the most important thing in orthodox and long-term investment is to start. If you don’t start with any amount, nothing changes.
– In this case, one’s own life cycle must be financed only by day work and wage income. If you start saving, you will get traction on the stock market to finance your own life cycle, Paasi says.
It is also worth considering their future retirement dates. Retirement usually means a drastic drop in income, making current living standards and housing more difficult to afford. When you start saving on time, you can collect a nice pot for even small amounts.
The future of a child, grandchild or even godchild can also be secured by saving and investing a small amount in it every month.
2. You can start with a few euros
Today, you can invest in much smaller amounts than before. Information, opportunities and tools are available in a completely different way than in the previous millennium.
– I think young women and men have found the investment exactly as it should be, ie as part of normal economic management, says the head of the Business Delegation (EVA) and investment writer Emilia Kullas.
Paasi also points out that you don’t have to be Kroisos to start investing.
– I claim that everyone can afford to put 15 euros a month aside for cost-effective and long-term stock savings. For most Finns, it is also realistic to strive for this, Paasi says.
Iltalehti’s investment columnist Merja Mähkä gives advice in Raha magazine on how to start investing in funds. Pasi Liesimaa
3. Investing is really easy
Perhaps the biggest misconception about investing is that investing would be somehow difficult. That is certainly not the case.
– A sensible investment is pretty boring: just put a certain amount in the index fund every month and wait, says the economist Jukka Appelqvist From Danske Bank.
Investment writer and investment columnist for Iltalehti Merja Mähkä is on the same lines. He encourages you to start investing in funds.
– The fund is simply acquired by deciding the amount, for example EUR 50, and making a fund subscription in your online bank or through the website of the management company. An entry is basically a transfer from your account to the management company’s account. And that’s it! You are an investor.
4. There is no need to fear losing everything
It is often said that don’t invest more than you are willing to lose. Jukka Appelqvist finds the saying unnecessarily frightening, but thinks it refers to the long span of time required for investment.
Paasi reminds us that you should never invest risky money that has an important use in the short term.
– It is very unlikely that you will lose everything. Especially in the longer term, it is almost impossible if decentralization is in order.
Mähkä reminds us that investing means that there are also bills along the way, so it is wise to decentralize and make investments at slightly different times – and of course to calm your mind.
– In history, Western stock exchanges have always – always always – recovered from all the collapses that happened along the way. When you remember this and can wait, you will survive the collapse well! Mähkä instructs.
5. Attaching all wealth to an apartment is a risk
Non-fiction writer, entrepreneur and financial coach Unna Lehtipuun According to Finns, the original sin is to tie wealth too much to housing. This can be seen when looking at municipalities with migration losses. There are hundreds of thousands of people tied up in houses for which there is no demand.
– This is a national trauma and vulnerability in Finland. The situation is different in Sweden, even though the countryside is being emptied. People there have also diversified their wealth elsewhere, and not all eggs are in the same basket, Lehtipuu regrets.
If you live in a rent, there would be an even greater reason to accumulate wealth by other means.
– If housing does not accumulate its own wealth, for example in the form of a loan repayment, it would be really important to have other places where the wealth can be found and where to invest it.
Investor and actor Jasmin Hamid appreciates the sense of security that investments bring. Jasmin’s interview can be read in Raha magazine. Jenni Gästgivar / Iltalehti
6. Money lying in a savings account does not work
Korona taught many that it is good to be saving an amount equal to a couple of months of fixed spending. To get the buffer together, you should chart your relationship with money and make your own budget.
– I often use a very descriptive saying that money without a budget is like champagne without a glass. Valuable content drains if you don’t try to control it somehow, says Unna Lehtipuu.
Once the bumper is piled up, it’s a good idea to think about placement. According to Lehtipuu, Finns still passively spend their money in savings accounts, which means that they do not generate anything.
– Call placement for active saving. That’s what it really is: money is put aside in some places where it grows in value, Lehtipuu says.
7. Everyone gets rich when you wait for malt
– Yes, investing will get rich, and even more easily. In the world of investing, there are now easy and cost-effective solutions that allow anyone with a little extra money to really get rich, says Mähkä.
Pennies don’t come by investing millions, but tens can become thousands. By investing 20 euros a month, you can accumulate a thousand euros in four years. Saving ten tons takes 60 euros a month and ten years.
– The biggest difference to the lottery is that it is practically impossible to win the lottery, even if someone sometimes wins. By investing long-term again, you will definitely win, Mähkä says.
Martin Paasi, for his part, sums up wealth by investing as follows:
– The only thing that prevents anyone from getting rich is that it is not long-term enough. Moderation is also an asset in investing.
8. You can influence the future of the planet
Financial markets are the most concrete way to implement the principles of sustainable development in the world. According to Martin Paas, financial markets are, in effect, a democracy of money. People’s opinions and values are reflected in where money is directed.
– Nothing else changes the world more effectively than any of the pressures that provide funding to require companies to change their business models. This is worth thinking about, for example, from the perspective of climate change, Paasi says.
Author of responsible investing book Kaisa Kurittu urges the investor to consider their own values. What you want to own and what you don’t want to own. Especially what you don’t want to own is a good starting point.
– As more money is directed to companies that operate responsibly, the operating conditions for companies will improve. On the other hand, companies that are questionable and whose activities threaten the well-being of the planet find it more difficult to obtain financing and more expensive for them. That’s when it hurts their operating conditions, Kurittu explains.
Responsible investing is also productive, not charitable.
– According to research, responsible indices have performed better than others in recent years. The phenomenon is due to the fact that money is increasingly moving towards them, Paasi says.
9. Get extra security and options for your everyday life
Merja Mähkä reminds that most of the investment is boring and does not lead to amazing results quickly. But in the long run, investing increases choice in smaller and larger things.
– It is essential that investing increases relevance in your own life. No need to become a millionaire and buy a lizard from Palm Island with a pool in the yard. The importance of investing is weighed in everyday life rather than at a party, Mähkä says.
Jasmin Hamid emphasizes the same. Although he himself has a plush equity portfolio and a couple of investment homes, he doesn’t dream of an early retirement or splurge.
– Instead of riches, I value a sense of security. The fact that you don’t have to think about the price when choosing a tomato puree.
More information on investing and interviews with all the experts can be found in the recent Money magazine. Buy Raha-erkoislehti together with Iltalehti or read visual and thematic magazines from Iltalehti Plus.
The Money magazine provides practical advice and ideas for valuing, saving and investing your own wealth. Jenn Gästgivar