What You Didn’t Know You Already Knew About Investing 

Illustration by Kendra Yee

Written by Frankie Barnet

Maybe it’s the vocabulary: mutual funds, stocks, bonds, cleafs (ok, that last one is made up). Or maybe you’re stuck on images of 1980s Wall Street bros with sweaty foreheads giving each other high fives. But what if I told you that first-time investing isn’t so different from going to law school? Because the truth is, no matter what connotations you’ve grown up with, the world of investing isn’t some sterile place, devoid of human touch. And you can make the process more approachable by finding parallels with what you already know.

Five ways to bring what you already know to your first investment experience: 

1. Focus on your hopes and dreams

“Financial planning comes down to using your money in a way that aligns with your goals,” says Manager of Financial Planning at Lawyers Financial Karen Sill, stressing that there is absolutely no one size fits all approach to investing. The first step any financial advisor will go over with you is assessing what you want and when you want it. Homeownership, loan payments, retirement, starting a family. An investment strategy for someone who wants to buy in the next decade might look very different from that of someone who prefers to prioritize an early retirement. 

2. Risk is unavoidable

Maybe there was a time in your life when you vowed to stay under the covers forever and never face the bullies at school, kind of like the childhood equivalent of sticking your money under your mattress. “But that carries risk too,” Sill stresses, explaining that the longer you wait to start investing, the longer you miss out on potential returns your money could earn. While in general, more risk equals more reward, there are investment strategies for whatever your level of risk tolerance may be. And remember, you did end up getting out of bed. You went back to school, spent another fifteen years there, and now you’re a lawyer. 

You’re already an investor. Law school was a significant investment of time and money towards a future that you knew you wanted but weren’t certain would work out.

3. Losing is ok

If you’re investing for the long term, your returns will fluctuate—and that’s ok. Maybe one year your profits will be down 10%, but the next year you’re up 20%. You’re in it for the long haul and that means taking the bad news in stride, focusing on long-term growth over short-term disappointments. Kind of like how that one break-up, or a rejection from your top choice program felt like the end of the world at the time, but with the gift of a few years’ perspective, you can see it's not that big a deal. It may even have led you precisely to where you are now: earning enough money to start thinking about investing. 

4. You’ve done this before

You’re already an investor. Law school, for example, was a significant investment of time and money towards a future that you knew you wanted but weren’t certain would work out. Significantly more money, by the way, than you’ll put towards your first mutual fund contribution. You invest time with friends and family too. These relationships aren’t always easy but they're worth sticking with because these are the people who’ll offer you emotional support when you need it. Even something like a new jacket that helps you hold your head high when you negotiate a pay raise carries the same principle: you put your resources into something now because you have faith that it will pay future returns.

5. Help is available

Many would tell you that there are more enticing options for young investors now than ever before. Unfortunately, this doesn’t make the process any less daunting. But there’s a lot of help out there too. Sill broke down four main investment strategies: Direct Investing, where investors take a hands-on approach and trade stocks and bonds directly; Robo-Advisor, where a digital platform provides automated, algorithm-driven investing advice; Managed Funds, where you remain active in the process but work with an advisor who offers guidance along the way; and Private Wealth, the most hands-off approach reserved for larger sums of money you’d prefer to delegate the management of. While it might not take a village to come up with a good investment strategy, you’re absolutely not alone in the process. 

If investing still sounds complicated, that’s because it can be. But I’m guessing it’s not your first experience with something complicated and whether you like it or not, it won’t be the last. Yes, it can often feel like Financial Wherewithal is an elite club to which your invitation got lost in the mail. But the reality is that we all have the right to understand how our money works and what it’s capable of doing for us. 

We can help

Lawyers Financial offers free financial planning to law students, lawyers and other members of Canada’s legal community. Get practical advice about investing, managing debt, and making a budget that leaves room for living. Book a free 30-minute financial planning session now. 

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Frankie Barnet lives in Montreal and is the author of An Indoor Kind of Girl