Losing your money is never fun, especially when you consider that investing in a company (or any asset for that matter) doesn't guarantee returns. It's already overwhelming when you first start out, and now we have to also worry about scammers trying to snatch our hard-earned cash too!
Here’s what they had to say about scams that are currently happening, what you should do with your money as a beginner, and who you should follow for practical advice about managing your money.
Bola Sokunbi (Clever Girl Finance) and Tori Dunlap (Her First $100K) both graciously gave me some time out of their busy schedules to provide some advice for beginner investors and tips on avoiding scammers.
So how do you know when you've stumbled upon one of those annoying (and dangerous) scams? Bola says building your knowledge first is the best protection. "Don't take anyone's word as gospel. Educate yourself on personal finance so you can decipher the junk and make smart decisions for yourself. Do your research and due diligence before you put your hard-earned money into any investment."
And according to Tori, focusing on your long-term goals can also help you avoid getting scammed. "If it sounds too good to be true, it might just be (except for high-yield savings accounts). That’s not always the case, but I think a lot of people are drawn into investing because it’s talked about as this magical thing where if you do it juuuusst right, you might get rich!"
And there are definitely common red flags that you should keep in the back of your mind when entering any investing forum or whenever you encounter a new "hot tip."
OK, I get it: If it sounds too good to be true, then be careful —now what?
The main takeaway: The best way to avoid scams is to take control of your education and do your research before you buy into any investment.
Have you come across any scammy "investments" in your feed? Tell us how you spotted scammers in the comments!