8 Financial Lessons I Learnt in 2021

Hi Seedly Community!

In this article, I will share my mistakes I made so far as a beginner in investing. In 2021, I took a huge responsiblity on my own finance and took a big step forward to try out new things on my own. I used to have the mindset from my parents that the stock market is a dangerous place and I should never go into it at a young age. Till today, I don't disagree with my parents because there were definitely mistakes made along the way.

These are the lessons learnt in 2021 to myself:

1. Don't buy for the sake of buying ; AKA settling for penny stocks

As an undergraduate student, I don't actually earn a fixed sum of income, hence, allocating aside some money for investment can be pretty tough for me. Moreover, I prefer using brokers such as "Moo Moo" and "Tiger Broker" which don't allow fractional share. I was not able to afford 1 share of GOOGL which cost about 2.9k USD and I tend to settle and look for other stocks that I could buy. There were times where I was left with some money, I would look for penny stocks. <-- here is the problem

Let me share with you, those penny stocks I bought is not doing well at all and I regret all of them but thankfully it was still small money mistakes which I think is prone to happen for beginners. I learnt to save till I can afford the stock or to look for other alternative brokers such as IBKR which allow fractional share. I will not make the same mistake settling for less.

This went downhill....

2. Don't google search " Best Stock to Buy Right Now"

As a Gen Z, I rely on technology a lot, so I would always rely on the internet for opinion and ideas. I will go onto reddit to read posts from WallStreetBets which now I realise that I shouldn't trusting anybody's opinion on which stock I should buy.

I learnt that articles and opinion from the internet are posted to manipulate and can change an investor's decision. Right now, many are influenced by the social media, and good marketing strategies which is completely different from before.

Not just in the stock market, Cyptocurrency has also gained lots of attention.

"A greater volume of cryptocurrency transactions leads to fair cryptocurrency prices and removes the chance of distorted pricing.". When article or tweet is posted, market will fluctuate. Hence, do your own research and don't go all in.

3. Don't time the market

I took a lot time to watch YouTube videos as well and many investors shared as well that we shouldn't time the market. It is hard or even impossible to predict when will be the best time to enter the market. I experienced it myself that I was waiting for a long period of time but eventually the it never goes down. I learnt more about dollar cost average and compound interest.

4. Don't FOMO just because it is "trendy"

I made mistake buying the stock during its ALL TIME HIGH just because the social media said it was a good buy. I felt that I will be missing out if I don't buy it and this is where the problem lies. I feel the market moves very fast nowadays and there will be an opportunity to buy again.

5. Don't fear , HODL

"HODL is a term derived from a misspelling of "hold," in the context of buying and holding Bitcoin and other cryptocurrencies. It's also commonly come to stand for "hold on for dear life" among crypto investors."

The market were not doing very well few months and it's my first time feelingfearful because looking at the hard earned money decreasing wasn't easy. I learnt that this is normal and I'm not alone.

6. Be extra careful around the internet because SCAM is everywhere

Technology is so advanced, I feel that we're not at the stage where people are super smart on the internet because everything is so new and fresh. I joined many NFT discord channel because I was interested in understanding more about it. There were many giveaway events happening in every channel and it is legit because friend won one of the giveaways. BUT I received many chats on the daily basis that I won a giveaway and there will be a link to redeem them etc.

Even I learnt that there is fake links to mint the NFT. Scammers are really intelligent now and let me tell you the website looks exactly the same. Please be extra careful.

Our fingers are so fast when comes to clicking on the screen, there are times where I skip all the instructions and not read at all. Please don't click into random links and connect your wallet.

7. No such thing as easy money

There are scam that allow you to earn huge sum just by clicking a button. Please don't ever fall for that because it may cost you a fortune or even unneccessary loss of money. Don't let greed take over you and let you make poor choices.

I learnt to not be greedy.

8. Be patient and wait

I read a few books this year and every book tells me to wait. As a beginner, I tend to jump into the app everyday to check how is it going. All those time i spent I could be doing something better. haha

“Time is more value than money. You can get more money, but you cannot get more time.” – Jim Rohn

All in all, these are the lesson I have learnt in 2021 and I hope no one will fall for the same mistakes. Wishing you a very prosperous New Year! May the upcoming year be filled with success and wealth!