The mystery of money is prevalent among so many of us. It makes sense: many of us simply aren’t raised to understand money, finance, investing, the stock market and beyond. In high school we learn concepts that hardly apply to real life, but not how to do our taxes. Our employers hand us 50 page packets that explain what to expect from your 401k. Banks often give you the amount of attention you “deserve” based on your net worth.
But, there are ways to educate yourself. Here are three investing secrets you need to know.
1.) Getting a tax refund is a bad thing.
There’s certainly a thrill in getting a lump sum every March or April, but if you’re getting a fat tax refund you’re doing something wrong.
Why? Because that money was always your money. The average tax return is around $3,000. That means that people are missing out on having $3,000 throughout the year. That’s $3,000 you could have earned interest on, invested with, paid down debt, or had as an emergency fund.
What you’re doing instead is giving the government a free loan. By overpaying your taxes—because that’s all that a refund indicates if you’re above the poverty line—you’re letting the government hold onto your money until the end of the year.
It’s much better to consult a CPA and find out how much you should be paying each month or how much you should have taken out of your paycheck. And, with the taxes constantly changing, it’s good to do so yearly.
2.) You don’t have to invest with your money
For a long time, the thing that held me back from investing more actively on the stock market was simple: I simply didn’t have the money to risk.
But then I discovered prop trading. Prop trading, in essence, lets me use a company’s money to trade on the stock market with. Then I get to keep part of the profits.
I searched high and low for the best prop trader. The conclusion I reached was this: Try2BFunded was the best of the bunch. Not only is the profit split much more favorable than other companies— Try2BFunded lets me take home 60% while other companies were offering 20%—it also features an easy interface and straightforward process.
Prove that you’re able to trade well, make it past the qualifying round, start making bank. All without touching your own savings account.
3.) Knowledge is power, and power is profit
Trading well means staying on top of an ever-changing global economy. Leviathan companies like GE, once a powerhouse, can crumble. Upstarts like Tesla can become heavily valued.
So how do you make the most of the information? Turn to the experts.
I’ve been an enthusiastic subscriber of Chaikin Analytics since I first discovered it. For me, it’s the ultimate knowledge aggregate. The combination of mega-powered algorithmic analyses of stocks, sectors and markets with editorial advice, articles, webinars and so much more from world-class experts helps me stay in the know. This is one of those cases where spending a little money can earn you a lot.
4.) Patience and diligence pay off
Ok, this one is less of a secret, but it’s something everyone needs to hear. Don’t skip months where you match your 401k and max out your Roth IRA. Don’t panic during a recession and pull out all of your money—there’s a reason younger people can invest with greater risk. Time is on their side.
Panic is what ends up ruining people’s financial futures. So keep it cool, keep it calm, keep it collected, and keep contributing.