Fearless Finance: How To Overcome The Fear Of Investing

Stephanie Liang, Walter Payton College Preparatory, Sophomore, Spring 2025

The buzzword nowadays is investing — stocks, bonds, ETFs, etc. But what do those words even mean? According to a 2019 survey done by GOBankingRates, 47% of Americans aren’t taking advantage of investing (Huddleston, 2019). On any social media platform, “finance bros” and “experts” flaunting the thousands they’ve earned from their investments seem inescapable. People are constantly raving about investing, yet the average American knows little about it. Pew Research Center reports that “about one-in-five Americans with lower incomes (22%) say they don’t know much or know nothing at all about personal finances” (Edwards, 2024). This highlights the disparities between low and high income Americans. Amidst the precarious state of our economy, it’s essential for people to utilize financial tools. A tool Americans can leverage is investments. However, the hard part is understanding where to start. ETFs, bonds, mutual funds, and stocks are all just different types of investment options. Simplified down, bonds are essentially a loan that is given to the government for a set amount of time in order to get money back but with interest. As for stocks, they are a piece of a company that you own as an investor and it generates income through different methods, such as dividends. Lastly, ETFs and mutual funds are both a collection of stocks or bonds, but with nuanced differences. While investing seems overwhelming, taking a little time to understand the terms and taking actionable small steps is already half the battle. 

How young is too young? The earlier someone can start investing, the better. Elizabeth Stack, a financial advisor, recommends that people start investing early to take “advantage of compound interest and outpace inflation”. One way to do this is through special accounts designed for kids, such as custodial brokerage accounts, which enable parents to help kids select investments. However, make sure that proper research is done before starting to invest and align your investments with your values. Some informational resources recommended by Lindesy Prochot, a leader of Walter Payton’s Investment team, are the “Mad Money Podcast w/Jim Cramer and the One Up On Wall Street by Peter Lynch”. There is definitely a learning curve to starting to invest. While investing offers the potential for rewarding returns, it's essential to start with caution, knowing that every opportunity also carries the risk of loss.

Sources Cited: 

• https://finance.yahoo.com/news/more-40-americans-aren-t-090000530.html 

• https://www.pewresearch.org/short-reads/2024/12/09/roughly-half-of-americans-are-knowledgeable-about-personal-finances/ 

Interviewees: 

Elizabeth Stack, financial advisor, erutkows@gmail.com 

Lindsey Prochot, leader of PACE at Walter Payton College Prep, lgprochot@cps.edu