“It takes money to make money.”
I have heard this cliche many times over the years. It didn’t truly hit home until the days and weeks after I opened my Robinhood account and launched my stock trading career.
Yes, I have opened CDs and watched 401ks grow. The Home Depot (HD) stock I bought in college, while working there as a cashier, has grown exponentially. All fine examples of money making money. However, the ability to buy and sell shares on my phone, to choose when and how much, or little in my case, this was a revelation. Dangerous, addicting, and life-changing to see the money that could be made and lost simply by tapping on my phone.
After my early, accidental success with Home Depot stock, acquired through an employee purchase plan from 2000 to 2004, I used my mustard-colored wall phone to call the broker about the possibility of buying more shares or setting up an account with the brokerage. The dismissive agent laughed at my youthful voice and exuberance. She told me that at a minimum I had to start with a deposit of $10,000. My investment dreams crushed, I ended the call disappointed and feeling the reality of the economic barrier I was up against. My life savings of $2,000 was not going to cut it, and my earning potential at the time wasn’t getting me to $10,000 in liquid cash anytime soon. I set my stock market dreams to the side. For years, I was only a passive investor in the retirement plans provided by various employers.
Trading on Robinhood
Fast forward to 2017 when my more app savvy brother Joe started talking about a broker that charged no fees for trading and had no account minimum. I was intrigued, and my old stock market playing dream was rekindled. I signed up via the referral link Joe sent me. Chesapeake Energy (CHK), trading at $4.20 at that time, was the free stock I received for opening my account. I plan to share of my ongoing experiences trading CHK, but that is a story for another day.
Armed with the Robinhood app on my phone, I could trade stocks through an intuitive and informative interface. I could play the market with the ease of playing Candy Crush. I was in control with no minimum deposit barrier and no cynical broker holding me at arm’s length. Just like playing a game on my phone, except this game had the potential for making and losing real dollars. Access to the realm had been granted to me, and now it would be up to me what I made of that access. Little did I know how much learning I would do in the school of hard knocks. I have loved it though, and I know that I still have a long, long way to go. My hope is that Joe and I can use this site to share the intrigue, hard losses, euphoric wins, and lessons learned as we continue our evolution as investors.
You Can Be Your Own Broker
I hope we can inspire you to start investing or to become a more active participant in your current investments. Robinhood opened the door for me, and I recommend their platform. Please do your research and check out online reviews to get a good understanding of the pros and cons before you take the plunge. You and I will both receive a free stock if you use my referral link. After opening an account with Robinhood, you can also apply for a cash management account that offers 1.80% APY, as of January 2020.
I appreciate how Robinhood disrupted the old guard of the industry with $0.00 commissions and fees. They created a platform that is intuitive and welcoming to the beginner investor. At the end of 2019, major brokers such as Charles Schwab and Fidelity Investments started playing catch up and switched to no or low fees for many types of trades. I respect Robinhood for leading this movement as an intentional business plan and mission while other brokers have followed suit as a necessity to retain business and to stay competitive.
Thank you for reading. Please stay tuned as Joe and I are just getting underway in creating this site and in sharing our stories.