If there is one thing that will define our generation, it will be COVID 19. This health crisis has redefined not only the health sector but also the economic and financial sectors. Even lay people like us have felt the brunt of this pandemic.
While it is difficult to say that COVID 19 is over, our two years of experience with it have taught us a lot, especially when it comes to investing. So, here are some of the lessons that we have learned in this journey so far.
Investing is King
The financial crisis brought about by the pandemic has taught us that investing really pays off. While most industries have suffered in the past months, people who have invested before the pandemic are the ones who are financially resilient today. Despite the loss of job and business opportunities, their earnings from their investments have somehow made them less susceptible in these challenging times.
Investing Needs Discerning
With the stock market suffering, hundreds of “investment opportunities” rose. But, as a smart investor, you have to be extra careful in choosing where to put your hard-earned money. From bitcoins to illegal gamblings, people are lured into investing in different projects. You need to dedicate time and energy to know how and how much you will earn from these investments.
Also, we have learned that investing is not a passive hobby. The market’s volatility during the pandemic has shown us that a good investor has to be proactive. Investors who wish to stay on top of their game have to be aware of recent events, news, trends, and updates so they can make the best decisions when investing.
Don’t Invest Everything
Do not put all your eggs in one basket. Know that there are inherent risks in all types of investment opportunities. So, be ready to lose money. The best thing to do is ensure that if an investment fails, you will not lose everything.
It’s important to diversify your portfolio. During this pandemic, we have learned that certain industries are volatile to a health crisis, including tourism, restaurants, malls, and many others. You have to put your money into several industries in order to avoid the possibility of losing all your money.
Have an Exit Plan
Remember to reap what you sow. Your investment should and will not last a lifetime. To make a profit, plan how and when you can withdraw your investment money alongside your profit.
COVID 19 has taught us that the market has highs and lows. In some cases, the future even looks bleak. As an investor, you have to know whether to continue or to stop with your investment.
It is difficult to say when this pandemic will truly end. But, as investors, these past two years have taught us the value of investing as well as enjoying the money we made from it. Although it seems difficult to control our finances today, our experiences during the COVID 19 crisis have taught us valuable lessons about finances, investments, and personal decisions.