Fear of Investing: Part 1

Starting new things is always frightening. However, for the beginner investor, the fear of taking the first dive into the unknown and mysterious world of stocks, ETFs and bonds can be paralyzing. So much so that many never move past having the desire to start investing.

We’ve been in your shoes and know first-hand how important it is to address and debunk all the myths surrounding investment.

Let’s take a look at some of them together and address the main fears one by one.

Fear #1: Only the rich can play investment games

It definitely used to be this way a few decades ago, but times have changed and luckily investing is accessible to many more people from all walks of life.

You don’t need much to start investing. You can easily find an ETF for 5 or 10 EUR. There is no “rule” or minimal required amount to create your portfolio and open an account.

A step to take:

Start small or play around at our Investment Gym before you hit the real stockbrokers’ sites.

Fear #2: Investing is like gambling, I will be broke in no time

My knowledge about the stock market has been limited for a very long time to the scenes in movies and TV series about the daring successful people in finance. I clearly remember the episode where Phoebe’s alter ego in the alternative reality lost all her client’s money because of the tiny dip in the market and got a heart attack on top of being fired.

That’s a real scenario if you try to actively time the market. We are not trying to imitate this while investing for retirement, for example. The longer the money sits in your account – the better.

There is a term in investment called compound interest. Being an avid gardener, I like to think about it in terms of plants:

Stage 1: You plant a tomato seed → This is like buying an S&P 500 ETF.
Stage 2: Your seed grows into a seedling → Your ETF grows by about 7% annually over time.
Stage 3: Your seedling matures into a large tomato plant, producing fruit → Over the years, your investment multiplies in value while continuing to grow.

Yes, investing involves risk, but not all investments are equally risky. A well-diversified portfolio (ETFs, bonds, stocks) reduces risk significantly. The real risk is not investing at all and letting inflation eat away your savings.

A step to take:

Choose one type of investment (preferably a low-risk ETF) and start small. Build your confidence and portfolio step by step.

Fear #3: I don’t understand any of the terms

Yes, there are a lot of weird new terms you need to understand to start investing. But once you read a little about them (and we are here to explain and help you understand together), you will feel much more confident. You do not need to be an expert with decades of experience in the stock market to start your personal investment journey. Even experts make mistakes, and the best strategy is to make a plan and stick to it, instead of trying to beat the market.

Steps to take:

Use our planner to create a personal investment strategy.
Choose one unfamiliar term from it and read about it in our learning kit.
Repeat the process until all the terms start to feel familiar.

Investing is a journey and a learning experience. We know there are many more fears that hold first-time investors back. That’s why we’ll be covering more of them in upcoming articles!