8 reasons young people don’t invest (and how to overcome them)

Do you ever procrastinate about things in life you know you should be doing? It could be cleaning the bathroom, going to the doctor for a check-up, leaving your job to do something you love, or a million other things we put on the backburner.

There are a lot of misconceptions around why young people don’t invest their money. When I speak with people my age, most of it comes down to the same reasons we don’t take steps in other areas of our life.

They believe it’s too much effort, too difficult or too scary.

In reality, anyone can invest successfully and easily. I’ve done it myself, as have thousands of other young people.

You’ll be surprised that you don’t need much to start.

Investing a small amount of money wisely in your 20’s will snowball and create the same result as having to take huge risks in your 40’s when you’re panicking about opportunity passing you by.

It’s my goal to help young people gain more confidence around their finances.

In this article we’ll look at the things that hold Gen Ys back from investing – and simple ways for you to overcome them.

The real reasons why young people don’t invest

  1. I don’t understand how to do it
    It’s human nature to fear and back away from things we don’t understand. In relation to making money decisions it’s usually because young people:

    • don’t have the right team in place
    • don’t have someone they can talk too
    • don’t feel it’s the right environment to invest
    • weren’t taught it in school (so how would they know?)
    • don’t trust finance people or the process
    • think they have to know everything first.

What’s the answer?
There are a lot of ‘experts’ voicing opinions, but the best place to start is a good investment book. They provide a great platform for learning. If you’re not a reader, then listen to the audio or visit a seminar or enrol in a course. The point is, don’t give up before you have started.

Check out my article on 5 must read authors to fast track you property investing knowledge

  1. It’s too hard
    Many young people think they:
  • lack the knowledge to succeed.
  • have to be a guru and across every aspect of investment.
  • have to do everything themselves.

What’s the answer?
The truth is, it isn’t easy (if it was, everyone would be doing it.). However, most of the tough stuff is in our heads. If you imagine it’s hard it will be and you won’t try. Sure, things won’t fall in your lap but effort pays off in a big way.

The key is to break things down into little steps and take that first one. it gets much easier once you get the snowball moving.

  1. I’m scared I’ll lose my money
    If this sounds like you, you’re not alone. You might be thinking:

    • What if my deal ends up like the ones you see on Today Tonight?
    • What do I know about investing?
    • What right do I have to be investing?

What’s the answer?
Don’t worry, I get it. I’m scared of losing money too. In fact, I don’t know anyone who isn’t.

But while you won’t be able to completely eliminate the risk of an investment, by having a good understanding and education of what you are doing you will minimise it.

If you’re not an expert than you need to surround yourself with an expert team that can guide you onto the safest path to success.

Life is risky, life is also short – so have a go when you are young and have plenty of time to right any wrongs, instead of wallowing in, “I wish I had…” old age.

  1. I’m too young

Maybe you don’t want to invest now because none of your friends are? With what little you do have, you’d rather spend having a good time before you need to get serious and boring about life.

A lot of young people feel this way and think they have all the time in the world to start investing.

However, year after year tick by and, before they know it, it is too late and they’re playing catch-up.

What’s the answer?
You’re never too young to start being smart about money and educating yourself on creating a better future and life. You might need to be 18 in Australia to invest in property, however you can take advantage of the material out there.

We need to look into the future and take note of those people who say, “God you’re so young, if only I was your age again and know what I know now. I would make so many better choices!”

They’re not old fools. They’re are sending us awesome free advice. Why on earth don’t we ever freaking listen to them?

  1. I don’t earn enough money

Investing is only for rich people right? Let’s get real.

Sure, it would be peachy to be Bill Gates kid, but you definitely don’t have to be rich or earning huge money to invest. I know and have read about countless people who started with a few scraps and a lot of discipline to build empires. I know it can be done. I managed to buy two properties when I was earning an electrician apprenticeship salary.

Many young people think:

  • I have to spend a million dollars to invest.
  • I don’t know about property or shares

What’s the answer?

It all comes back to gaining knowledge and understanding of different way to invest and trends.

There are so many different investment options – property, shares, car spaces, managed funds, term deposits, venture capital, private lending institutions, signage, collectables.

I know a few investors who make great money in investing in signage (advertising boards) that companies pay to advertise on. It goes up year on year.

Sure, a beachfront home on Bondi Beach might be out of the question but there are creative ways to get into property. For example:

  • partnering up with someone, joining incomes and sharing in the profit
  • investing in cheap suburbs.
  1. I don’t have enough money saved
    This follows on from the one above. Yes, it sure as hell helps to have a tidy sum under the mattress, but with some creative thinking, and a little know how, you can come up with:
  • ways to invest with really small deposits
  • ways to get a quick deposit.

What’s the answer?
Depending on your income and what you’re investing in, you may not need as much deposit as you think.

In real estate most banks would like you to have 20% saved and if you’re purchasing a $600,000 property than you need $120,000.

If you have say, 5%, you can look at alternatives like partnering up with someone else or investing in a good managed fund (let that deposit work for you whilst you save the rest).

Another option is a family guarantee loan. This allows the parents or close family to use their security (home) to help fund the deposit.

Check out this article if you want to know more about family guarantee


  1. I’ll have to change my lifestyle and won’t have any fun

There’s a perception amongst many people my age that putting money into investments means their very existence will be nothing more than sitting at home enviously watching their friend’s awesome lives, parties and travels unfold on social media.

Don’t worry, you won’t need your hermit costume.

Even if you do have to tailor your lifestyle around a little less spending in the short term, you’ll reap the good stuff in the long run.

In fact, if you’re smart, you can have fun on a stringent budget and save money at the same time.

What’s the answer?

This is probably the hardest for young people to understand, because we immediately associate investing with people who are older and have settled down.

But if you start young you can take smaller steps towards a better financial future. If you can try to save $100 a week from the time you start working full time, within 4 to 5 years you will be into the property market.

Those few extra drinks you don’t need. Taking a bus instead of a taxi. Walking up the road instead of driving. Bringing lunch from home a couple of days. Resisting that new game, dress, whatever now and again.

It adds up quickly.

Before you know it, you’ll own a property or other investment without having missed the good times.

  1. I don’t have time
    If I had a dollar for every time someone said “I can’t believe how fast time is flying by” I’d be writing this from my own private island in the Caribbean.

The fact is, everyone is busy – life is hectic – and the weeks do flash by. But every moment you spend now doing nothing about your investments will mean you have to spend more time later in life catching up.

And that’s when you really want to be kicking back and enjoying the spoils of your smart thinking and planning.

What’s the answer?

There’s no denying, you need to invest some time. Things just won’t fall into your lap. You’ll need to set things up, but most investments can be passive – so once that’s done you just enjoy the benefits on the backend.

Plus, you can get professionals to help you out here.

Where do you find that time to learn about investments? Sitting on the bus or train going to work. Sitting on the couch, instead of watching TV or Instagram.

There are plenty of hours sitting around waiting for you, if you want them.

The fact is, most of us spend plenty of time working a dead-end job on a crappy wage making someone else rich. Why wouldn’t you spend some time and energy learning how to make yourself rich?

If any of these reasons sound like thoughts going around in your head, be excited.

Because with a shift in your thinking and behaviour you can start setting yourself up for a really great life. That’s a pretty amazing opportunity to have. And something so many older people wish they’d done.

Do you want to be that person at the BBQ telling everyone that if only they’d started when they were younger they’d be so much better off?

Or the one who answers with a smile, “You mean like me?”

Remember working for someone else only pays you enough money to survive, investing will create income that will allow you to live.


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