How can a teenager invest in investments
Investment Tips for Teens | Why you should care about your money!
Bank. Finances. Account. We often only concern ourselves with these things when we really have to.
Especially when you're still young, the topic of money somehow still seems strange.
But according to a youth study by the banking association (as of 2015), more 14 to 17-year-olds are interested in the economy than in 2012. That is a good sign.
Young people are increasingly interested in the economy
Because nowadays it has become extremely important to deal with the topic of money. The world of finance has changed a lot since the global economic crisis in 2008.
What does it mean exactly?
In the years after the crisis, the banks in particular suffered. Some of them even had to close. Many of them were to blame, however, because they leaned too far out of the window with their investments and speculated.
But what does that have to do with my money?
Very much. Because in the past, before the crisis, you got good interest on your money in your account. In 2007, for example, you got almost four percent interest for 100 euros in the overnight money account at some banks.
It's not that much, is it?
At 100 euros that's only four euros, that's right. But at 1000 euros that would be 40 and at 10,000 euros it would be 400 euros. So you got paid pretty well for the money you had in your account back then.
Today it is very different!
Most accounts no longer offer interest at all, as banks can borrow money from the European Central Bank for almost 0%.
Investing in stocks would have been a good idea in 2015
This in turn allows them to offer cheap loans (lend money) and are no longer so heavily dependent on their customers' money. Savers and account holders suffer from this, because the banks no longer offer high interest rates (if you give your money to the bank).
The money in the account is therefore less, because there is no longer any interest and there are often account fees. But you can actively do something about it. BYou spoke to two investment specialists and gathered some great tips for investing:
1. Dare to do stocks
A share deposit can be opened at all good direct banks. If you are under 18, you will of course need the consent and signature of a parent. The best thing to do is to go to the house bank, recommends the fund manager Maximilian Thaler from DJE Kapital AG.
“Most of them already offer their own inexpensive online depots. The trading costs for shares, for example, are sometimes only a few euros, "Thaler told BYou.
There is one thing that you should definitely pay attention to here: “The large and well-known online brokers are members of the deposit protection fund of the Association of German Banks. This means that customers are protected up to 100,000 euros even in the event of bankruptcy, ”says Thaler. So it makes sense to go to a larger bank, as there you are better protected in the event of a total loss of money.
2. Saves in the long term
Funds and fund savings plans sound complicated at first, but they are not at all. Above all, the selection is very large here and you can also invest smaller amounts, says Jörg Knaf, Executive Managing Director at Natixis Global Asset Management.
„With a savings plan, you can start saving earlier and thus participate in the company's profits for a longer period of time. That generates significantly more income, ”says Knaf.
Most savings plans usually start at 50 euros, but there are also some providers where you can invest 10 euros a month.
Funds have the advantage over stocks that you invest in a number of companies. So the risk is lower.
"So if you want to keep the time investment low (...), you often do better with funds than with individual shares," says Thaler.
3. Beware of startups
"Start-ups may be founded by young people, but they are financed by experienced and (above all) wealthy investors," says Knaf.
The disadvantage here is that a start-up usually only has one idea up its sleeve and that is risky for a long-term wealth strategy. "Start-ups only make sense later, when you are able to speculate with part of your assets (...)", says Knaf.
The fund manager Maximilian Thaler also advises against investing in start-ups. “According to market data, unfortunately, many end up in a total loss for the investor. Only a very small number of companies make it into profitability. "
It is better to invest in so-called small cap funds that focus on investing in small to medium-sized companies.
"Here, the companies have often already left the start-up phase with a lot of losses behind them and are in a strong growth phase (...)", says Thaler.
4. Don't panic
“Just don't panic and don't act emotionally. Better to stay cool if the stock market should fall, ”recommends Knaf.
In addition, you should keep your hands off things that you don't understand. "Then it's better to turn to an expert you trust."
5. Pay attention to the costs
Take a close look at how high the costs for stock portfolios are or how much fees are charged for trading stocks or funds.
Compare the offers and choose a reputable bank. It is always important that you have a direct contact person at the bank.
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