*Note: This article does not necessarily reflect the views of The Teen Trillionaire, and is written purely based on the author's opinions*
The stock market has been one of the many factors supporting our country’s economy. And like everything, it can be a highly controversial subject for many people.
If you don’t know, the idea of stock trading expanded during the Industrial Revolution. The Revolution was a time where countries started making machines and new manufacturing processes. People, especially the poor, would often go to factories to work. These factories became a money-making machine. And their owners and executives wanted to expand the factories and their companies’ interests. Hence, the introduction of stock and other financial instruments. But of course, you aren’t looking for a history lesson. The importance of this time is that people started investing in factories once they realized it could generate a lot of money. But they did not understand how investing worked and often invested poorly. This resulted in heavier losses than gains. Many people became loaded with debt.
Conservative people, maybe your parents or people with investments didn’t really pan out or gain any money, might be more hesitant to put a portion of their income into the stock market. Investing can create debt, especially reckless investors with a low rate of return. And you’ve probably heard about the Stock Market Crash of 1929 or the stock market crash of 2008. Both were prominent as they were the two of the worst in America’s history. Millions of people lost billions of dollars.
Other people might not invest in stocks simply because they don’t have enough money. They have to put their income in savings, retirement plans, expenses, etc. Others are simply not educated enough and skeptical of the market.
But there are many benefits I believe when it comes to investing in the stock market. It can be a way of gaining another stream of income, which can help with investing in savings and retirement plans. Also, investing in stocks does not necessarily need a lot of capital. Investments like this can help your money grow over time, unlike if they were locked in a savings account or spent on frivolous things. Another benefit is that it can increase your net worth. This isn’t really important, but who doesn’t want to become richer? And last, I believe that investing in the stock market can teach the investor many things. Strategies are essential, and good management also helps a lot. You can apply your investing experiences to other situations, for example, it may help you think about how to solve a problem differently or be more innovative and strategic.
Written by Allie Chang