Investing Truths: Finding the Confidence to Invest My Savings

I started saving when I was 16. Investing? That took me a few more years.

Before joining RBC in an editorial role, my first retail job paid enough for me to put away 100 bucks in a savings account every other week and still have a bit of extra cash to blow. (I ate out a lot!) I'd log into my banking app and watch the total grow – eventually hitting $2,400 within a year. Such a good feeling.

I was super-impressed with my ability to save – that is, until I was introduced to the importance of making my savings work for me, a.k.a. investing.

“How can you just sit in cash?" my investing-savvy friends would ask. “You could be making so much more."

It felt like a challenge, or at least an opportunity to learn something new!

However, I knew that investments could go two ways: gain or lose. With investing comes different degrees of risk; there was a possibility that I could lose a big chunk of my savings.

On the flip side? I might just be able to buy a house sooner than I thought.

I decided to try it – on the condition that I would have control over each penny that I'd be investing.

Was I confident? No.

Was I clueless on where to start? Yes.

I wasn't ready to take the full plunge with an investment account, but I'd heard about practice accounts from a colleague who had one. With $100,000 in pretend money, I could practice with investing in companies and securities without risk. Perfect!

I tried it out.

At first, I thought I could just pick a stock, enter the number of shares I wanted and call it a day. Not quite. There was so much more to it! Did I want a market order or a limit order? Did I want to set a stop price? What did that even mean?

Because my practice account gave me access to the same tools and research that I would get in a real account, I could get comfortable and test-drive the platform – without worrying about making mistakes. I used the opportunity to familiarize myself with the trading process and test-drive the platform.

And hey, it was exciting to manage $100,000! Not that I'll have that much of my own money to manage for a while, but I found it reassuring to know I could learn how the site worked, and how to place trades without practicing with my own savings.

Earlier this year, I finally took the plunge and placed my first trade in a real account! It was nerve-wracking, yes, but it also felt familiar because I'd become so used to the whole process using my practice account.

I'm certainly no pro yet, so I still test the waters. I use my practice account for anything new I want to try before taking action in my real account. I may not feel quite ready to take on options trading just yet, but at least I know how I'll tackle it when I am.

* This article was updated on October 1, 2018