Easy Rules to follow for Beginning Investors

1. When you buy a stock. Hold on to it. An investors best ally is time. The S&P 500 has averaged an annual return of approximately 11% since 1929. In 40 years an investment of $1000 a year would be worth nearly $1,000,000. Would you like to become a millionaire? If you do then I'd suggest you start investing as soon as possible and leave the money in.

2. Compound interest is one of the greatest inventions of man. Take advantage of it and open up an online savings account. Many online savings accounts have annual returns of around 5%. This money will compound on itself so that the interest your money is earning will itself earn interest as the account stays open. Many stocks have similar features, the dividends on the stocks I purchase are automatically reinvested in that company. This is a form of compound interest.

3. The market is down this week, what should you do? Buy. Make sure that a company is either in good financial health first. But when the market starts falling and you want to make more money, you need to start buying. Remember "Buy low, Sell high!". It is actually that easy. There are many different players and factors that influence the stock market. Some of them even earn themselves titles, like "Santa Rallies" where retail stocks begin climbing during the winter months as people head out to buy presents and investor try to figure out what they are buying and what companies will benefit the most.

There are also seasonal sell offs when major financial institutions sell assets in order to realign their portfolios. Just because the major companies are selling these stocks doesn't mean they are a bad investment for you though!

4. Pay yourself first. This is a strange statement, and possibly dangerous if you can't control yourself, but another important rule to investing is to take the money you may ordinarily waste on superfluous items and instead "pay yourself first" and put that money to work for you in the stock markets or atleast in a high yield savings account.

Investing is not as complicated as it looks and if you are willing to put just an hour into researching a stock pick you will be reasonably prepared to make investment decisions for yourself and begin to own your own financial future.