Hey, friends! Alex here.
Does that little scene give you anxiety? You’ve done the research, you’ve chosen the stock, you’ve even typed in the amount. You just have to press the button.
But then, a tidal wave of fear just washes over you. What if I lose everything?
If you’ve ever felt paralyzed right before making your first move, you are dealing with the single biggest hurdle in personal finance: the Fear of Starting Investing.
It’s fueled by one terrifying belief: that making a mistake is the worst possible outcome.
Today, I want to tell you a story about my very first investment. It’s a story about a $50 mistake, and why making that mistake was the smartest thing I ever did.
1. The Genius Who Lost $10 (My Origin Story)
We have to travel back in time. Back to a version of Alex who had a lot less wisdom.
I had just opened my first brokerage account. I felt like a genius. I just knew I could find the next big thing before anyone else.
One evening, scrolling through some tech forum, I found it: my golden ticket. It was a tiny, obscure tech company—something like Nanodynamic Future Tech. People were posting rocket emojis. The hype was intoxicating.
I gathered all the capital I was willing to risk—a grand total of $50.
My heart was pounding. My palms were sweating. Fuelled by a dangerous cocktail of greed and ignorance, I clicked BUY.
Just like that, I was an investor.
2. The 48-Hour Roller Coaster (My Three Lessons)
What happened next was a masterclass in investing psychology, delivered to me over 48 hours.
Lesson 1: The Illusion of Genius
The next morning, the stock was up 8%. My $50 had turned into $54. I was a king!
The takeaway: The market can make you feel like a genius for all the wrong reasons. My tiny gain had nothing to do with my brilliant research; it was pure dumb luck. This is a dangerous trap that leads people to take bigger risks.
Lesson 2: The Pain is Twice the Pleasure
The second morning, the stock was down 15%. My glorious $54 had shrunk to $46.
The takeaway: The pain of losing money feels twice as strong as the pleasure of gaining it. This psychological bias, called loss aversion, consumed my thoughts. I couldn’t focus on work.
I sold everything, locking in my $10 loss, just because the anxiety was too much.
Lesson 3: The Real Cost of Trading
I had spent 48 hours on an emotional roller coaster, consumed by anxiety and false hope, all over $10. I didn’t just lose money; I lost two days of my life.
That was the final, most important lesson: A portfolio you have to watch every day is not an investment. It’s a source of stress.
Honestly, my story is not unique. These kinds of emotional decisions are the most common beginner investing mistakes. If you want to see just how universal these errors are, this guide from Citizens Bank breaks down 8 common investing mistakes—it made me realize I wasn’t alone.
3. The Real Enemy is NOT Starting (The Cost of Inaction)
As I sat there, staring at my $10 loss, a new thought emerged. What did I actually buy for that $10?
I realized I hadn’t bought a loss; I had bought an education. It was the best tuition fee I ever paid.
But that realization led to a more terrifying question: What is the real risk in investing?
The Greatest Mistake of All
The single greatest risk, the mistake that can actually ruin your financial future, is the mistake of doing nothing at all.
The cost of my $50 mistake was $10. But what is the cost of spending 5, 10, or 15 years on the sidelines, terrified by the Fear of Starting Investing?
The cost is hundreds of thousands of dollars in missed growth. While you’re waiting in cash, a silent thief called inflation is robbing you blind every single day.
You see, the choice isn’t between making a small mistake and being safe. It’s between making a small, affordable, educational mistake now, or making the catastrophic mistake of letting your future slip away. Ending the Fear of Starting Investing is paramount. Check out this breakdown on the real risks of letting inflation steal your cash.
4. Your License to Fail (The 1% Rule)
If doing nothing is the real enemy, how do we start without feeling like we’re betting the farm? How do we conquer the Fear of Starting Investing?
I call this framework your “License to Fail,” and it’s incredibly simple. It’s the 1% Rule.
The 1% Rule in Action
You take 1%, or less, of your total investment capital, and you put it into an Education Fund. This is your sandbox. This is money that you are mentally prepared to lose entirely.
If you have $10,000 saved up, your license to fail money is $100. If you save $500 a month, it might be just $5.
You use that tiny amount of money to make your first mistake. Buy a share of that ETF you’ve been researching. The goal here isn’t to make money. The goal is to get in the game, to press the button, and to beat the Fear of Starting Investing.
If you make money, great. If you lose it all, even better. You just bought yourself a valuable lesson for a price you were willing to pay.
This small step needs to be rooted in a long-term mindset. If you want a guide on overcoming that initial hurdle with patience and diversified strategies, this resource emphasizes overcoming the fear of investing.
5. From Fear to Freedom (Next Steps)
Losing that $10 taught me that I wasn’t built to be a trader. I needed a different kind of system—a Set It and Forget It system that would protect me from myself.
Losing that $50 didn’t set me back; it put me on the right track for the very first time. Now it’s your turn.
If your fear is now changing to a new worry—Am I starting too late?—don’t worry. That’s the next common hurdle. I made a full guide tackling that exact feeling, showing you how to accelerate your timeline and Catch Up on Retirement. Check out my guide here.
Conclusion: Embrace Your First Mistake
You have everything you need to take that first step and finally conquer the Fear of Starting Investing.
Your journey is not their journey. You’re not behind. You’re not late.
You are right on time, because you are starting now, with more wisdom, more clarity, and a bigger shovel than you’ve ever had before.
Your Action Plan Awaits: Ready to put your 1% Rule into action and build your first safe portfolio? I’ve distilled my entire blueprint and simple tools into a free PDF guide.
👉 Click Here to Grab My FREE “7-Minute Retirement Quickstart” Guide!
Now go make your first brilliant mistake.
