A beginner’s guide to early career investing

Whether you’re catching a bus or making a big life change, timing is everything. But for investing newbies watching the markets and trying to gauge the ideal time to get started, the question of timing is less complicated than you might think.

“Perfectly timing your investments is extremely difficult for even the most accomplished investment professionals,” says Michael Williams, Director of Portfolio Advice and Investments with RBC InvestEase, an easy-to-use online investment manager. “But on top of that, when we look back in history, we actually see that timing the market is only one contributor to an investor’s long-term returns. Some successful investors will agree on that it’s time in the market that matters, not timing the market.”

In other words, if you’re looking to start growing your money to achieve your financial goals—whether that’s planning a dream trip, buying a home or even something further out—there’s no better time than now.

Why time in the market matters

Succeeding at investing isn’t just about finding the right ETFs to sell at a big profit later. In fact, between long-term market gains and something called the compound effect, simply investing can be a powerful tactic for growing wealth.

That’s because taking a long-game approach avoids some common pitfalls and stresses, such as dealing with dips in the markets.

“Typically, the recurring pattern is that financial markets eventually resume their upward course,” says Williams. While he notes that long-term investing “isn’t a straight line,” the longer an investor remains in the market, the more time longer-term gains have to cancel out shorter-term losses.

Investing for everyone

After the uncertainties of the last couple of years, it’s no surprise that finances are top of mind for Gen Zs and millennials. According to an annual global survey of this group by Deloitte, finances top the list of concerns for younger adults. Roughly three in 10 say they don’t feel financially secure, and 26 per cent of Gen Zs and 31 per cent of millennials worry they won’t be able to retire in financial comfort.

But for those who’ve never invested before, or who may not have a lot of money left over from their paycheck at the end of the month, investing can seem complicated and overwhelming.

That need not be the case, says Williams. “In the past, investing had a high barrier to entry,” he notes. “But recent technological innovations in the industry have really democratized investing for everyone. For example, at RBC InvestEase you can open an account with just $100 and access a professionally built investment portfolio based on your goals. So you don’t need a lot of money or knowledge to get started.”

Here are some helpful tips for getting started:

Invest what you can afford

Many investors cite 10 per cent of one’s gross income as a good annual investment goal. But not having that level of cash flow shouldn’t deter younger investors.

According to Williams, the best amount to invest is one is simply one that’s doable after the rest of your expenses are covered. Or consider setting up an automatic contribution to your investment account, so that you think about it like a monthly bill. “That sum should be manageable and consistent,” he says. “As you start to save more money, you can always adjust your regular payments.”

Pay off high-interest debt first

While the promise of returns might have you eager to get started, it’s important to consider your full financial situation first—and specifically any existing debt, such as a student loan or credit card debt.

“If you have high-interest debt, it can be almost impossible to consistently earn a rate of return on your investments that exceeds the interest rate you are subject to,” says Williams. In such cases, it’s a good idea to pay off the debt first.

Know where to turn for help

An expert can be a powerful partner in helping you set up and stick to a smart investing strategy. “Investors have many options available to help them reduce the work and avoid some common mistakes, similar to how they might seek the help of a dietician or a trainer,” says Williams. “At RBC InvestEase, clients answer a quick, easy questionnaire to get started. Based on their answer, we are able to recommend a portfolio that best suits their financial situation.”

To learn more about how you can start investing today, visit rbcinvestease.com

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