If that headline shocks you, you’re not alone. I read this statistic in a recent Wall Street Journal article today and was pretty surprised. The author also shared some reasons people aren’t investing:
“21% said they weren’t investing because they don’t understand the market…53% of people who aren’t in the market now said they weren’t investing in the market because they didn’t have the funds to do so.”
I have a bigger problem with the lack of market knowledge than the lack of funds. The lack of investor education largely falls on the industry. It’s part of the reason we’ve been sending our clients a weekly email for 10+ years here at Mullooly Asset. We’ve also been producing weekly podcasts and educational videos for quite some time. This is all in an effort to educate investors about the market. I get it, the market is a massive and daunting entity that scares many people. Fear of the unknown isn’t a new phenomenon. The best way to combat fear of the unknown is by increasing your knowledge. In addition to this site, there are tons of other great financial bloggers and resources available online. In fact, we link to the excellent work of our industry peers often in the News section of the website.
As for the 53% who don’t have the funds to invest, that very well may be the case. However, getting to know yourself financially is a good way to determine if/what you’re capable of investing. I mean it when I say that if you can reasonably afford to invest even $50-$100 a month, you should consider doing it. Your future self will thank you.