Thursday, October 27, 2011

Saving is Not the Same as Investing

I'm really good at saving money - so good that one of my friends thinks I should start teaching others (specifically her) how to do it.  The problem I have is that the things I know seem so obvious to me, I don't even know other people need to be taught!  Does that make sense?  If only I'd thought of it first - there are lots of people out there telling people how to use coupons, how to shop when things are on sale, how to stock their pantries, etc. - things I've been doing for years!

If only I'd gotten an Online Broker way back when and started investing all that money I've been saving!  I really don't know anything about investing, though.  I'm really clueless.  The only thing I know about Stock Trading is what I've seen in movies like Wall Street and The Pursuit of Happyness, and it made no sense whatsoever to me.  I still can't figure out why people lose money when the stock market falls.  So you buy a stock at one price.  If the price of that stock goes up then the stocks you own are worth more - but how do you make more money unless you sell them at that higher price?  Same with when the market goes down - the stocks you own are worth less, but how do you actually lose money unless you sell them at that lower price?  See, I don't understand it at all. 

I'd need someone who's good at Online Trading to explain all the basics to me.  Someone who can tell me - If I'd started investing all the money I've saved, would I have more money now or less?