Inflation is silently erasing your future wealth every day.
When you leave money sitting in a traditional savings account with a bank, it only earns 3-4% interest. Meanwhile, inflation runs at 15-20%. That means the ₦1,000,000 in your savings account today will only buy you ₦840,000 worth of goods next year.
After five years, your million naira will be worth less than ₦500,000 in today’s terms.
Your only solution is to invest.
However, the common problem regarding investments is the fear of loss.
Many people are paralysed by the fear of losing money, which prevents them from ever starting to invest. Fear of loss in investing is like being stuck in quicksand. The more you panic and resist, the deeper you sink.
However, suppose you educate yourself and understand the nature of the risk (the quicksand). In that case, you can find stable points (knowledge) to pull yourself out and eventually reach solid ground (successful investing).
Investing is like Planting a Money Tree
Educate yourself to manage risk, rather than avoid it.
Investments for beginners start with education. Knowledge is your shield, and understanding is your sword. Arm yourself well before entering the financial battlefield.
Beware of information overload when searching for investments for beginners
Investment websites, financial news, constant market updates…
It’s easy to get lost and make impulsive decisions based on fear or hype. Beginner investors are feeling overwhelmed by the flood of information. There are blogs, YouTube videos, X posts, and financial jargon like “dividends,” “bull markets,” or “blockchain”.
The fear of choosing the “wrong” investment amplifies this problem and can force you to keep your money idle in a low-interest savings account, losing value to inflation.
To overcome these hesitations, here are three major investments for beginners you can make right now and the direct steps to undertake these investments:
1. INVEST IN U.S. STOCKS
Warren Buffett got wealthy through this investment.
He transitioned from buying stocks of companies in his country at a young age to owning major shares and eventually owning some of these companies.
Buffett got wealthy for two reasons. The stability of the United States (U.S.) economy was the first reason. And then his consistency, discipline and due diligence.
For U.S. Stocks, think about companies like Apple, Microsoft, or Amazon. Even a small investment in these giants can yield significant returns over time.
HOW CAN YOU INVEST IN U.S. STOCKS?
Today’s technology makes it possible to buy and sell U.S Stocks as a Nigerian.
For instance, I use a mobile app called Bamboo. Bamboo is a platform that allows you to use your Nigerian (or foreign) bank details to access these shares of U.S. Companies. There is also Trove, but I haven’t tried it out.
As a beginner, start with fractional shares.
Many platforms now allow you to buy a fraction of a share. This makes it accessible even with limited capital. So, instead of waiting until you can afford a whole share of a high-priced stock, begin with what you have.
You don’t need 1,000 shares of a top tech stock of a company in the USA to begin your investment journey. Start with 3 and grow from there.
Do your research and due diligence, too. You might find a more secure, faster and convenient way to buy U.S. stocks if your research is done right.
2. INVEST IN MUTUAL FUNDS
A mutual fund is a form of collective investment where money from many investors is pooled and invested in various securities (such as stocks, bonds, treasury bills, etc.) under the supervision of a fund manager.
In simpler terms, Mutual funds can be imagined as pizza slices where you are able to get extra value (in this case, profit) usually exclusive to the table of the wealthy.
I love mutual funds because of their stability, diversification and relatively competitive returns.
Invest in Index Funds, too.
An index fund is a type of mutual fund or exchange-traded fund (ETF) that tracks a specific market index, like the S&P 500. A Nigerian can now invest in an S&P 500 index fund through a platform like Bamboo or Trove, gaining exposure to 500 of the largest U.S. companies.
Generally, investing in mutual funds reduces individual stock risk and saves you the time and effort of researching and managing individual securities.
HOW CAN YOU INVEST IN MUTUAL FUNDS?
You can always purchase mutual funds from licensed and authorised asset management companies.
For instance, I invest in mutual funds through Anchoria Asset Management Limited. There is also Stanbic IBTC and Zedcrest.
As usual, I advise you to gather knowledge and seek guidance before purchasing mutual funds.
3. INVEST IN CRYPTOCURRENCY
This is the most futuristic and arguably a debatable investment path on this list.
Think of cryptocurrency as the digital frontier of finance. It’s exciting and full of potential. But crypto is also with its own set of unknowns and risks.
For example, Bitcoin is a currency based on complex digital technology and solely traded on the Internet.
For a start, explore established cryptocurrencies like Ethereum or newer, promising projects with strong underlying technology.
HOW CAN YOU INVEST IN CRYPTOCURRENCY?
In the past, I used mobile apps like Luno and Trust Wallet to buy and store my cryptocurrency.
And the returns were really impressive. Personally, I am still sceptical about how these digital currencies operates. So what I do now is to buy a small amount of crypto in Naira, withdraw the capital after a few months and leave the remaining volume in my crypto wallet.
Better safe than sorry. Maybe you can try this method too.
I have also found a safer, faster and better platform – Coinveto. The founder, Ofoegbu, is my friend, and I have bought cryptocurrencies from him and recommended his services to others for over three years. Great guy.
You can check the platform too.
The most important thing is… You must embrace technology and the role it is playing in modern society.
Technology is accelerating rapidly, entering virtually all sectors of the economy. And Money is one of them. So, endeavour to balance both your knowledge and experience before venturing into any investment.
Treat your investments as a diversified garden
Think of your financial portfolio as a garden that needs constant attention and care.
U.S. stocks from big companies are like reliable fruit trees that provide regular harvests (dividends). The sturdy trees that grow slowly but provide shade and stability to your garden are the mutual funds. Then, you have some exotic plants (cryptocurrencies) that can either thrive dramatically or wither unexpectedly.
Each plays a role in the overall health of your garden.
Be a good gardener. Your investment portfolio will always need regular review, rebalancing, and sometimes, complete restructuring. Be the investor who knows how to adapt to these conditions.
Investments for Beginners must go this route
How to Go from Zero to Investor.
You don’t have to start big.
Start small because these methods far surpass leaving your money in the bank. What people also don’t realise is that your financial confidence compounds like money. Every small win gives you courage for a bigger step.
Your first ₦6k might not double, but your belief in yourself will.
For example, if you earn ₦120,000 monthly, commit to investing ₦6,000-₦12,000 consistently each month across your chosen platforms. Bamboo for U.S. Stocks, SEEDs by Anchoria for mutual funds, or Coinveto for Cryptocurrency.
Don’t overanalyse until you are paralysed.
Pick one platform. Invest a small amount. Learn from action, not just research.
Diversify like a Chef, not a gambler.
Start by allocating 50% of your investment contribution to stable stocks (e.g., S&P 500), 30% to mutual funds, and 20% to crypto. Then rebalance quarterly or yearly.
This is how investments for beginners work.
What if You Lose Money?
All investors lose money.
The key is losing small to learn and earn big. Never be discouraged by short-term fluctuations. Rather, focus on long-term growth. Investing is often a marathon, not a sprint.
Most beginners quit because they expect instant profits. Investing isn’t gambling. It’s planting seeds and nurturing them with patience.
You wouldn’t dig up a mango seed after 2 weeks and complain it hasn’t turned into a tree, would you?
Invest your time, knowledge and then your money in these investments.
Investments for Beginners
