So, you’re new to the investing world and have been hearing others talk on and on about their wins and future plans in the stock market. I, just like you, was always curious about investing but didn’t know where to start. I recently got into reading, listening and trying to understand how best to get into this world as an average person and to learn more details on investing for beginners.

To be honest, I found it difficult to find the right information that was easy to digest. I found it tricky to figure out HOW the hell I get involved in investing; how it works and even trying to figure out who the most reliable brokers are. Firstly, I’m not a financial advisor, I can’t tell you where to put your money to get the highest returns. I’m just a person on the internet, who is starting off their investing journey, just like you.

But after lots of researching, I landed on Vanguard. These are the guys who you can invest money through their into a stocks and shares ISA and here you can put money into the S&P 500 for example. More on that later. Vanguard are one of the oldest brokers and have the lowest fees. So I figure they are the most reliable and are known to have great customer services (in case you get completely lost.) If you need help on saving money first, before investing, read my recent Top 10 tips to help you be better with money Post here.

For all of the below, make sure you read their terms & conditions. Ensure you understand how much Vanguard charge for Fees to invest with them. It isn’t much, and they are renowned for the lowest fees but it’s important to know nonetheless.

As I said, I’m not a financial advisor, and this isn’t a sponsored post for Vanguard in the slightest. I just wanted to share with you my journey and on how you too can get involved in investing as an absolute beginner. And to be honest, Its actually really easy. No, really.

Step 1: Start Today, and open an account.

Here is the main website for Vanguard in the UK. Click on the “Open an Account” up the very top of the Home Page on the Vanguard website. Easy so far.

This will bring you to a Log in/ New Customer page. If you already have an account with them, log in here. Or if you are indeed starting from scratch, click on the Start Application. The Investing for beginners requirements are below:

• National Insurance number
• Debit card details
• Bank Details (if you are doing regular payments)
• Be 18+ years old and be a UK resident

Remember, for a Stocks and Shares ISA, you can invest up to £20,000 per tax year in the UK, to ensure there is no tax paid on your earnings. If you an absolute baller with loads of money, this will work out as investing £1,666 per month, this is one to bear in mind so you don’t get hit with a surprise tax bill. There is more info here on ISA Do’s and Dont’s to help guide you.

Or if you’re on the other side of the coin, and need more side hustle income to be able to invest, then read my post here on how to make money quickly online.

Ok. Are you still with me? If you have all of the above at the ready, then click “Start my Application…

Step 2: Choose Stocks and Shares ISA

For the purpose of showing you how investing for beginners works, choose the “Stocks and Shares ISA” option here.

A declaration and Terms & Conditions will open up. Make sure you read and understand this (don’t skip past it). This is your money and your responsibility to understand what could happen to it. The returns aren’t guaranteed and your money could be at risk.

But don’t let this scare you off never ever investing though. There will always be ups and downs in the stock market in line with recessions, pandemics, wars etc. If you have a plan to invest for the long term, your money is likely to be less at risk. Also we should see a growth and return on our money too if we leave it for a long period. We hope anyway!

Step 3: Choose what to invest in.

You will come to a section like the above, where you can choose what to invest in.

Now, this may become complicated for you if you have never heard of any of these. Do your research. I repeat, do your research! I personally invested into the S&P 500 as doing my research this is the best fit for me personally. Essentially, this is the Top 500 companies in North America. And essentially it means you can buy a slice of them all. This is called an Index Fund (or an ETF)- where you invest in a group of companies together.

This is considered less riskier, compared to just investing into one company that may go bust in a few years time. Having a group of companies together like the S&P 500, means if one of the 500 companies isn’t doing well, you wont be majorly effected. As the other 499 companies will hold up the price of the Index.

You may choose a different fund for yourself. If you want to invest in the S&P 500 for example, you will find it by scrolling to Equity Funds>USA> S&P 500 UCITS ETF (VUSA).

Step 4: Choose a Single Payment or set up a Regular Payment.

You can either start investing with Vanguard by depositing a one off £500 or you can invest regularly from £100 per month. The choice is yours. For maximum gains, I have personally opted into investing £100 a month. This way the interest will keep building up the longer I leave my money in my account, on top of what I invest. This is known as compound interest.

For example, if I use 7% rate of return (some periods have shown 10%+ rate of return on investments in the S&P 500 , lets use 7% here.) SO if you invest £100 per month for 10 years at 7%, you will make £5,308 in INTEREST. FREE MONEY! This is versus if you just invest £500 as a once off and leave it in for 10 years, you will get just £504 in Interest. That is the power of compound interest and also the more money you put in, the more interest you could make. If you don’t believe me, check out this Compound Calculator and see what you could earn in Interest over time. It will blow your mind.

As this is “investing for beginners”, you must always ensure you are able to afford your payments and that you’re certain that you won’t need this money in the short term. The way to get the most out of investing in an Index fund such as the S&P 500 for example, is to leave this money in for the long term, i.e. for at least ten years. Yes that’s a long time, but I reckon you still feel like a teenager today even though that was 10+ years ago- right? Time does go fast. So you should think about your money today, and how you can live off of potentially Thousands £££ of Interest in years to come if you are smart with investing.

If you can’t part with £100 a month for the next 10 years, then you should opt into the one off payment of £500 and put money into your investment account as and when you have it. There is no point in investing into an Index fund like the S&P 500, if you will withdraw the money out in a short time frame. Then you would be losing out on compound interest and are more at risk of not seeing the best Rate of Return if you sell at a low point.

There are ways to use the stock market to your advantage and be smart with your money whether you’d class yourself in the “investing for beginners” category or more advanced. Everyone has the chance to do well from investing in the long term, if you just stop and think before you act.

If you want to invest £100 a month (which in the minimum you need to invest for regular payments), you just pop £100 here, as shown below:

The next page will take you to add in your personal details. This includes your name, your national insurance number and your bank details. And that’s pretty much it!!

Step 5: Get a confirmation email & BOOM you’re now an investor.

See, I said it was very straight forward.

You will usually get a confirmation of your setup over the next 7 working days. That’s it you’ve graduated from Googling Tips on Investing for beginners to straight up becoming an Investor. You’ve taken the leap and done it. Well done. Many of us just think about Investing and never actually do it until it’s too late as you’ve wasted all that time. Having time on your side is your friend with long term investing like this, so you can still have a chance to grow and reap the rewards pre-retirement age. Heck, you might even retire early at this rate. (No, really.) When you read about the FIRE movement (becoming Financially Independent and Retiring Early), investing is always the first step.

From here, you can log into your Vanguard account to check on your investment movements. I recommend that you don’t check the movements every day- you will drive yourself crazy! The stock market moves up and down. It’s normal. The best way to invest long term is to set up a regular payment, automate it, and leave it! Don’t look at it constantly. If you’re very curious, you can look at it once a year, once every 6 months etc. This prevents your emotions taking over and selling them when you see the slightest of dips.

I hope this was helpful to start you on your investing for beginners journey. Comment below if you have just set up your investment account. Also share what your money plan is for the future to help others here. What are you investing in and why?

Thanks all, chat soon!

The Spend & Save