What is Investing (And Why It Matters in 2025)

If you've ever felt like investing is only for experts in suits or people who already have a lot of money, you're not alone.

But here’s the truth: anyone can start investing, and the earlier you begin, the more powerful the results can be.

Whether you're saving for retirement, building wealth, or just curious about how money can grow, this guide will walk you through everything you need to know - from the very beginning.

What Does It Mean to Invest?

Investing is the act of putting your money into something that has the potential to grow in value over time.

Instead of letting your cash sit in a bank account earning little to no interest, investing gives it the chance to grow.

That growth comes from buying assets - like stocks, ETFs, or even real estate - that ideally increase in value, or generate income through dividends or interest.

The key is understanding the types of investments available and knowing how to choose the right ones for your goals and risk tolerance.

Understanding Stocks

Stocks are one of the most well-known and accessible types of investments. When you buy a stock, you're purchasing a small piece of ownership in a company.

If the company grows and becomes more profitable, the value of your share usually goes up too.

For example, if you buy a share of Apple, you're becoming a shareholder - a part-owner of one of the most valuable companies in the world. If Apple performs well, your investment might increase in value.

Some companies also reward shareholders with dividends, which are regular payments made from their profits.

What Are ETFs?

If picking individual companies sounds intimidating, that’s where ETFs (Exchange-Traded Funds) come in.

An ETF is like a pre-packed basket of multiple stocks or assets you can buy all at once.

Imagine owning 500 companies through one investment - that’s exactly what an ETF like the S&P 500 does.

ETFs are especially good for beginners because they offer diversification, simplicity, and low fees.

You don’t need to pick the winning company - the ETF holds a mix, balancing performance over time.

Step 1: Choosing a Broker

Before you can buy your first stock or ETF, you’ll need to open an account with a broker - an online platform that lets you access the markets.

Look for:

• Low or zero trading fees

• User-friendly interface

• Mobile access

• Good customer support

Popular brokers in Europe: DEGIRO, Trade Republic, eToro
In the U.S.: Robinhood, Fidelity, Charles Schwab

Step 2: Fund Your Account

Once you've set up your broker account, it's time to deposit funds.

This usually involves connecting your bank account and transferring money.

You don’t need thousands to start - even €50 to €100 is a great beginning.

Start with what you’re comfortable with. The important thing is building the habit and getting familiar with the process.

Step 3: Make Your First Investment

This is where it gets exciting - but also where most beginners feel stuck. What should you buy?

You can either:

• Do your own research (DIY investing), or

• Use a research-backed stock pick service like Finance Pickers to identify high-potential opportunities.

Whatever path you choose, make sure it aligns with your goals, time horizon, and appetite for risk.

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Have a Plan Before You Buy

Investing isn’t gambling. You need a strategy.

Ask yourself:

• Why am I investing? (Retirement? Wealth building? Passive income?)

• How long can I leave my money invested?

• How would I react if the market dropped 10%?

Many smart investors follow a long-term strategy, such as dollar-cost averaging - investing a fixed amount regularly - which reduces risk over time and builds discipline.

What Are Dividends?

Dividends are payments made by companies to shareholders, usually quarterly. It’s a way to share profits with you, the investor.

Not all companies pay dividends - but those that do can provide a steady income stream.

Some investors even build whole portfolios around dividend-paying stocks for long-term passive income.

Final Tips for Beginners

• Start small, stay consistent

• Don’t try to time the market

• Reinvest your dividends if possible

• Be patient - wealth builds over time

Above all: keep learning. The more you understand, the better your decisions will be.

Summary: Ready to Invest Smarter?

You don’t need to be rich or lucky to start investing. You just need to start - and have a smart plan.

Finance Pickers gives you the data-backed picks to build that plan.

🎯 Join our free 14-day trial and get our next high-conviction stock sent straight to your inbox.

Disclaimer: This article is for educational purposes only and does not constitute financial advice. Always consult a licensed advisor before making investment decisions.