The thought of investing your hard-earned money in the stock market, with no guarantee that it will grow or even that it won't decrease in value, can be daunting. After all, there are always concerns that the next recession is just around the corner or that the next major geopolitical event will disrupt business as usual. Even seasoned investors, myself included, can be rattled by headlines screaming about the trade war or the latest conflict in the Middle East.
That is why it is so important to keep a proper perspective. Since 1926, the year the S&P 500 index was conceived, the stock market has given investors an average annual return of 10%. While inflation eats into that, making the real return closer to 7% or 8%, the stock market has still created an incredible amount of wealth for investors over a period that includes the Great Depression, World War 2, the Cold War, terrorist attacks, and countless natural disasters. There are very few, if any, vehicles that allow American investors to create as much wealth as the stock market.
If you're ready to start investing, here are a few things you should know…
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