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Editor's note: Today, we're sharing another must-read essay from Dr. David Eifrig's free e-letter, Retirement Millionaire Daily, which you can sign up for right here. Below, "Doc" explains one of the biggest mistakes you might be making right now. If you're having second thoughts about investing today, this essay is for you...

How Fear Will Ruin Your Financial Future

By Dr. David Eifrig, editor, Retirement Millionaire Daily
Monday, January 11, 2016

More than half of all Americans are ruining their financial future...
A survey from online banking-news aggregator Bankrate found that 52% of Americans are not invested in the stock market, including in their retirement accounts.
Not investing is one of the biggest mistakes you can make if you want a wealthy retirement.
Some of those folks probably have great excuses. Maybe they lost a job... Or they don't trust Wall Street... Probably, money is tight. Or it's just "too hard" to figure out the brokerage forms to get started.
These excuses are all based on fear.
When it comes to investing, fear prevents most people from starting. Whether it's fear of losing money or fear stemming from ignorance.
It's common investor behavior to freeze in the face of fear. A tiny part of your brain called the amygdala kicks in whenever there's a perceived threat.
The amygdala makes us want to avoid risk.
Money, in today's society, represents a sense of security. We need money in order to obtain what we need to survive... food, shelter, medicine. Any threat of losing money can trigger the amygdala to kick in full force.
But that fear is dangerous to your investments. The "safest" thing for your amygdala is to follow the crowd... to stay out of the market until you hear that everyone is buying in – normally at the top.
When you hear cocktail-party chatter filled with stories of stock victories, that's a classic sign of the end of a bull market and the start of a bear market. It works the same way with fear, too...
As author and financial columnist Jason Zweig writes in his book, Your Money and Your Brain, we saw this type of fear when the market dropped 23% in a single day... the "Black Monday" market crash.
At the time, I was working on the trading desk for Goldman Sachs. On October 19, 1987, the stock market fell more in a single day than the crash that started the Great Depression. That's a crazy move. And when things get that crazy, clients panic...
For days, we worked, ate, and slept at the office... and helped our clients move assets around. It was a true global panic. There was no time to go home, so we simply wore the same clothes from the day before.
It was a nerve-racking experience, but it taught me one simple lesson: When extreme fear hits the market and things are falling apart, it creates incredible opportunities.
That October, people ran for the exits, selling off as many stocks as possible. And the fear kept people wary of stocks for years afterward... even as the market went on to post year after year of gains, eventually rallying more than 500% from its crash levels to peak in 2000.
The story repeats itself throughout history – most recently in 2008.
On September 29, 2008, the Dow Jones Industrial Average fell nearly 7% in one day... Investors left the market in droves. By the end of 2008, trillions of dollars were pulled from the stock market.
Within a few months, a new bull market began.
But those who sold at the bottom – and were too afraid to get back in – robbed themselves of an incredible opportunity to make money. Since March 2009, the Dow has risen more than 163%.
Even here at Retirement Millionaire Daily, one of my research assistants was scared of the market.
So I challenged her to start investing. I even bullied her a bit to get her to stop digging her heels in.
She told me that the hardest part of getting started was finding where to open a brokerage account. As she told me:
I approached the assignment like I would with any other: with hours of research. I went through many different trading websites, only to find myself overwhelmed with forms and instructions.
For example, just trying to figure out how to fund my account was awful. I don't live too close to a branch of my bank, so the process of setting up a wire transfer seemed tedious and time-consuming.
Worse, I only had a small amount to invest and many brokerages required minimum balances beyond my means.

After a few months of research, she opened her first brokerage account and started investing. And a lot of her initial fears are gone.
To help you get started, here are four simple things to know when looking for a brokerage account:
1. Fractional shares. If you're starting off with a small portfolio, find out if the brokerage firm offers a plan to let you invest in fractional shares. That way, you're putting some money to work immediately, even if it's not enough to buy, say, an entire share of Apple. Just pay attention to what fees you might have to pay.
2. Fees. Figure out what the fees are for completing a trade. Some places charge fees for fractional share transactions as well, which can affect your budget. Make sure you know exactly how much each trade will cost before you start so you won't get any surprises. Some brokerages, like Fidelity, Schwab, TD Ameritrade, and Vanguard, offer commission-free funds.
3. Minimum balance. Some brokerages require a minimum account balance. For example, Interactive Brokers has a minimum balance requirement of $2,000 and you need to spend at least $10 per month in commissions. On the other hand, Capital One Investing (formerly Sharebuilder) offers a $0 minimum balance and you don't need to spend a certain amount on commissions each month. So if you have a small portfolio or you don't plan on trading often, this might be a better option for you.
4. Taxes. Every brokerage will provide a form for tax time, but make sure you read the fine print. See if you are required to go online and request the form or if it will be automatically mailed to you. Make sure you understand how it works and you'll save yourself a headache.
If you still aren't sure about taking that first step, remember that the most important step is the first one – getting started.
And if you know someone who should be investing but hasn't started yet, feel free to share this article with them. Help them kick the fear and get going on the road to building wealth today.
Here's to our health, wealth, and a great retirement,
Dr. David Eifrig

Further Reading:

Make sure to read the other investing ideas we've featured from Doc's Retirement Millionaire Daily right here:
"Anyone who reads a newspaper or watches financial news regularly is always going to have a reason to get out of the market. Don't be one of them."
"I've been telling readers to buy municipal bonds for a long time. They have been – and will continue to be – a great deal for income-seeking investors."

Market Notes

Not many... the S&P 500 starts 2016 down 5%

CSX (CSX)... railroads
Union Pacific (UNP)... railroads
BP (BP)... Big Oil
Hess (HES)... Big Oil
Encana (ECA)... oil and gas producer
Transocean (RIG)... offshore drilling
Rio Tinto (RIO)... diversified miner
Vale (VALE)... diversified miner
Mosaic (MOS)... fertilizer
Morgan Stanley (MS)... investment bank
Nordstrom (JWN)... clothing retailer
Chipotle Mexican Grill (CMG)... burritos
Denny's (DENN)... restaurant
Ruby Tuesday (RT)... restaurant
Dunkin' Brands (DNKN)... donuts
Red Robin Gourmet Burgers (RRGB)... burgers
Papa John's (PZZA)... pizza
Twitter (TWTR)... social media
Dish Network (DISH)... satellite TV

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