Successful Investing: It’s Easier Than You Think
Money. We all need it. We never seem to have enough. And most of us wish we had started saving earlier. But money is nothing more than a tool that can work for or against you, lifting you to great heights or miring you in misery. Think of it as a magic lamp — wonderfully powerful, but in the wrong hands…
My own financial journey was a twisting, winding road. As a child in China, I knew my father worked in America, a magical land with mountains of money and golden roads. He worked double shifts as a busboy to pay off the smugglers bringing the family over. At age five, I found myself in the Bahamas hiding out in a cheap motel room until they could arrange our fake passports, occasionally sneaking outside to rub my empty stomach and get snacks from friendly locals. I still remember the day we left for New York, when the head smuggler gave me a giant Hershey Bar. I have loved chocolate ever since.
My father worked hard, but it was my mother who taught me all I needed to know about money — simply put, it was there to be made. All you need is focus and a work ethic. And she taught me well. Her feet had barely touched New York City concrete before she started sewing clothes in a factory; less than a year later, she was a part owner. Within two years, she had convinced her boss that her incredible gifts for rapid stitching and training others meant she could run the business better than he could, and the equity she built up from her labor allowed her to buy him out in under twelve months. It was a family business, with all her kids working there, but I was the star. By age ten I could hem a thousand pieces a day, and on good days, double that. In some ways, my career peaked in that sweatshop.
I was never afraid of hard work, of hiding in the bathroom from the labor inspectors, or of pulling needles from my fingers. I slept in the factory and went to school from there. My high school friends always thought I was too cool to hang out after class; I never told them I was heading back to Chinatown. But the workers there were proud of me, telling me that one day I would make a good wife to a Fujianese man, their highest praise. We were all Chinese immigrants; we were all family.
I had allowed a controlling person to control my money, and watched him use it against me.
Of course, wearing dresses made from factory remnants rankled me. I longed to be graceful and feminine, like the other girls. But my parents told us we were different, that we didn’t belong in this country. We came from the Middle Kingdom and were superior humans. It never made sense to me why we were here if China was so much better. But in America, there was money. We could never be rich in China. I was confused, but I did what my parents wanted — I helped the family and earned money. That was my sole purpose.
But even my mother knew that money has limitations. When I was trapped in a miserable marriage, she convinced me to give up two houses and the million dollars in our joint account so I could start over. She knew I could rebuild my life on the $600 I had left and I did.
Meanwhile, I had learned my own lesson; I had allowed a controlling person to control my money, and watched him use it against me. Somehow, I had become a woman who let her husband “take care of all that stuff” — a dangerous, potentially lethal position familiar to all too many women. I never imagined that would be me, and I never, ever wanted to be that person again, especially when I became a mother.
With two kids, I needed, ideally, two sources of income. My financial stability came from my legal clients, but what about having my money work for me? Isn’t that the dream? (And after working so hard for everyone else, wasn’t it time something worked for me?) I wanted to sit back — after work, of course — and watch my income multiply. For that, I started investing.
This was intimidating at first. People can’t wait to tell you how risky the stock market is, especially these days. Don’t you want financial security for your children? But life is about managing risks, about processing information and making decisions. Don’t invest any more than you can afford to lose, don’t expect to get rich overnight, and never put money in anything you don’t understand. Follow those rules, and stocks are no riskier than anything else life has to offer. Like getting married. Getting divorced. Getting married again. Having two children.
Never put money in anything you don’t understand.
My investment journey is just beginning, but so far I can report excitement, satisfaction, and more than a little pride. My goal was to earn $100 a day; I have already doubled that. Can I quit my job and retire? No, but successful investing gives me a sense of power and control all working moms sorely need, especially these days. And extra money is always welcome — after all, my nine-year-old son needs the best skate equipment for the skate park. And who knows where this all will go!
These three tips are what started me on my investment journey. They can get you started too.
Sounds simple, right? But financial experts use opaque language, so you feel you can’t do it without them. Ignore the lingo and focus on the companies themselves; understand who they are and why we need them. During the pandemic, I watched people lining up outside Walmart and Target. For our part, our family was spending $300 a week at Costco. After reading more about these companies, I invested — and it’s paid off.
There are a number of companies geared for beginning investors. I used RobbinHood.com, which allows me to buy stock and stock options. (For the uninitiated, stocks give you part ownership of the company, while stock options give you the right to buy or sell a specified amount of stock by pre-arranged date.) Even better, Robin Hood includes user guides and plenty of articles written at the layperson level, so you can start learning right away. It’s easy to be intimidated, but remember, knowledge is power, and understanding gets easier as time goes on. I read a lot about companies, even their securities filings like 10K, which fills in the gaps of what you should know before you trust them with your money.
Tip 2: Start small
How many people never invest because they “just need more money.” Money is like time; you never have enough to do what you want, so do it anyway. You can start investing with less than $20 and build on it; I started with $88, a lucky number in Chinese. Then — and this is key — learn to use limit orders or stop-loss orders on your trading platform to control your losses. Think about how much you’re willing to lose, and set a sell limit order; as the stock price goes up, raise the order. Even if the stock market crashes and loses 80 percent of its value, a sell limit order means you’ll lose a few percentage points but emerge with your shirt still on your back. And using option trading can make you money whether the stock goes down or up. Take time to read articles and ask questions; the confidence that comes with knowledge will allow you to make better decisions and stay in control.
Tip 3: Learn to use charts and indicators
Charts and indicators follow patterns and help you see which stocks are oversold (sold at a lower price than their intrinsic value) and overbought (sold at a higher price) Once you start to understand the charts and indicators, you can begin to make educated decisions about lowering your investment risk and growing your money. The key is understanding why you want to invest in that particular company and being comfortable with your decisions.
Most importantly, keep an attitude of abundance and believe everything will balance out in the end — it’s never too late (or too soon) to start. My father always told me I could be a doctor or a lawyer, and I chose law because I was so bad at math. But I found that numbers aren’t so bad when they’re growing my money. And if I can do it, so can you!
Disclaimer: this article represents the author’s individual investing experience and is not meant to be taken as financial advice.