Ready to Invest? What Do You Fear the Most?

When you consider becoming an investor, a few emotions likely surface: excitement, curiosity, and often, a heavy dose of fear.

We want to talk about that fear today, because understanding it is the true first step on your investing journey. It's time to pull back the curtain on the Wizard of Oz of finance and realize that the booming, clanging chaos is often caused by nothing more than a person just like you.

The Unexpected Gift That Started It All

My own investment journey began not with a grand financial plan, but with an unexpected loss. Back in 1979, my father died suddenly. My parents were divorced, and I was surprised to learn that in the last few years of his life, he had invested in stocks. My brother, my aunt, and I inherited about $40,000. He owned shares in companies like Philadelphia Electric and Virginia Power (now Dominion Energy).

My aunt, the executor, sent my brother and me checks and stock certificates for about $15,000 each. Following a friend’s recommendation, I opened an account at Merrill Lynch, and I’ve had money invested ever since—45 years!

If I knew then what I know now, I’d have a lot more money today. Neither my co-author Jack nor I received any instruction from our elders about investing. That’s why we wrote Cookbook Investing—so that anyone could have a resource for how to build and save for their goals.

There's really nothing to be afraid of.

Our Mission: Stability, Not Hype

Our goal is not just to teach you to trade; it’s to create a methodology that allows anyone to invest. We want more people and families to have access to additional wealth, the skills to buy and sell stocks independently, and ultimately, greater economic stability. We aim to help you establish a more stable financial foundation.

To that end, let me be very clear: We do not rely on Artificial Intelligence (AI). While AI offers to write or rewrite almost anything we can think of, we decline those repeated offers. Every word here is written from our own experience, joy, and hard-won knowledge of having made (and lost!) money investing.

We don't have all the answers or promise superior returns. But what we do offer is stability and calmness about investing. We do not believe in one-time, must-buy, can't-miss events. There is always another flight, train, or bus you can get on. You only compete with yourself.

Step One: Dealing with Fear and Volatility

Here’s the first thing you need to master: dealing with the fear and volatility that comes from investing.

Yes, some minor losses are inevitable. But so are the unexpected gains.

Your starting strategy should be simple and disciplined:

1. Start small.

2. Remain humble.

3. Remain nimble.

4. Be patient. Like a patient fisherman, learn to wait for the fish to take the bait. (In this analogy, you are both the fisherman and the fish!)

Let’s look at a quick real example. When I volunteered to be the Treasurer of The Poetry Society of VA, I took control of their funds and revised the investments to include mutual funds and some stocks. I did my research and found a utility, NRG (based in Houston, TX), with a high rating, costing around $34 per share. I decided to buy 100 shares—a larger position than the others.

Over the next two years, most stocks declined, but NRG soared. You simply cannot know the outcomes ahead of time. I bought based on research and conviction, and the market delivered a surprising win.

The Bottom Line: Your Simple Plan

The chaos and fear melt away when you embrace a simple, repeatable process.

1. Save modest amounts regularly.

2. Research some stocks.

3. Buy them, and see how they do.

4. If they look good, buy more. (And remember, just because a stock declines in price doesn't automatically mean you shouldn't buy more!)

Conquer the fear, embrace the process, and you’ll find that being an investor is far less intimidating than the market makes it seem.