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The 9 Essential Investing Principles for Getting Started

How to Start Investing the
Sound Mind Way!

For 25 years, Sound Mind Investing has been helping people become more knowledgeable, confident, and successful investors.

If you're a beginner and wondering how to start investing, you're at the right place. Think of this as our Investing 101 course, or our Investing for Dummies guide. 

When you’re ready to invest, we’re ready to help, with guidance that will walk you through our proven process step by step.

Before you get started, here are 9 essential principles everyone should know about investing in general, as well as our specific Sound Mind approach.

Principle 1

Why You Need The Stock Market

Who needs the stock market? You do! That is, if you want to retire some day. Or if you have a future dream/goal/plan that requires more money than you have now.

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Principle 2

Time is Money

One of the most important investing concepts is compound interest. And one of the most important aspects of compound interest is time. In this case, time really is money.

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Principle 3

The Ride Can Get Rough

While the stock market’s long-term trend is upward, its actual path is neither smooth nor straight. Instead, it’s marked by many twists and turns, with some scary downturns thrown in for good measure.

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Principle 4

You Have Some Control

In order to invest in the stock market, you have to be willing to accept some risk. But you also have to be able to sleep at night. We’ll help you choose a level of portfolio risk that’s appropriate for you.

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Principle 5

The Future is Uncertain

You don’t know the future, and neither do we (and that’s okay!) The good news is that successful investing doesn’t require the ability to predict the ups and downs of the stock market. It requires patience.

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Principle 6

Objectivity Beats Subjectivity

At SMI, our strategies are not based on intuition, gut feel, or any other emotional criteria. Instead, they are based on purely objective, rules-based systems.

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Principle 7

You Can Beat the Market

Even though we don’t believe in market timing, we do believe in outperforming the market, and that’s exactly what our strategies have been doing for a long time.

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Principle 8

Make Sure You're Ready

Just when you thought you were ready for take-off, there’s one more checklist to go over. Before putting any money in the market, your finances should be in order, with day-to-day cash flow running smoothly.

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Principle 9

Start Now

Now you’re ready. If you have a reserve and are debt-free (other than a reasonable mortgage), you are, indeed, ready to invest. But what if the market is at an all-time high or low? Is this really the best time to start investing? Yes!

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