Hey everyone, Hirokichi here. Today’s post is for anyone who’s thinking “I want to start investing, but I have no idea where to begin.” I’m going to walk you through how to get started in three simple steps. You only need about 10,000 yen to get going, so you don’t need a big pile of cash sitting around. By the end of this post you’ll have a clear picture of everything from opening an account to actually starting your first regular investment, so stick with me until the end.
Table of Contents
- Why 10,000 Yen Is Plenty to Start With
- STEP 1: Open an Account
- STEP 2: Choose Your Investment
- STEP 3: Start Investing Small
- Simulation: Growing From a 10,000 Yen Start
- Common Mistakes Beginners Make
- Wrapping Up
Why 10,000 Yen Is Plenty to Start With
When people hear “investing,” a lot of them picture needing a large chunk of money to get started. But these days, online brokerages let you buy investment funds (mutual funds, or “investment trusts” as they’re called in Japan) for as little as 100 or 1,000 yen. With 10,000 yen, you have more than enough to try out a few different funds or start a regular monthly investment.
What matters isn’t throwing in a huge amount right from the start – it’s starting small, getting comfortable with investing, and sticking with it over the long run. Think of that 10,000 yen as your “entry fee” for starting to practice investing. That framing makes it a lot less intimidating.
STEP 1: Open an Account
To start investing, you first need a brokerage account. For beginners, I’d recommend opening a new NISA account (Japan’s tax-free investment program), since any investment gains inside it are exempt from tax. Normally, investment profits in Japan are taxed at around 20%, but gains earned inside a new NISA account skip that tax entirely.
If you go with an online brokerage, opening an account usually takes about 10-15 minutes from your phone or computer, and after submitting your ID for verification, you can often start trading within a few days to about a week. It’s worth comparing fees and the range of products on offer to find a brokerage that fits you.
STEP 2: Choose Your Investment
Once your account is open, the next step is deciding what to invest in. For beginners, I’d point toward “index funds” – a type of investment fund. An index fund is designed to track an index like the Nikkei 225 or the S&P 500 (a major U.S. stock index), which means buying just one fund gives you exposure to hundreds or even thousands of companies at once.
If you invest in a single company’s stock, your money’s fate is tied entirely to that one company’s performance. An index fund spreads that risk out, which makes it a comparatively safer starting point for beginners. I’d suggest looking first at index funds that track the global stock market or the U.S. stock market.
STEP 3: Start Investing Small
Once you’ve picked your investment, the last step is actually setting up regular contributions. Most online brokerages let you set up automatic monthly purchases on a fixed date for a fixed amount. The key at the start is picking an amount you can comfortably keep up with, whether that’s 1,000 yen or 5,000 yen a month.
Investing the same amount every month also gives you the benefit of dollar-cost averaging (DCA – a method where you automatically buy fewer shares when prices are high and more when prices are low, which smooths out your average purchase cost over time). Setting an amount you can keep contributing even when the market dips is the real key to sticking with it long term.
Simulation: Growing From a 10,000 Yen Start
Let’s look at some actual numbers to see how much this could grow. If you start with 10,000 yen and add 5,000 yen a month, earning a 5% annual return, the math works out to roughly 770,000 yen after 10 years, about 2,010,000 yen after 20 years, and around 4,030,000 yen after 30 years.
Your total contributions over that time would be 610,000 yen at 10 years, 1,210,000 yen at 20 years, and 1,810,000 yen at 30 years – so thanks to the power of compounding, your balance ends up considerably larger than what you actually put in. (Note: this is a simplified estimate based on a fixed rate of return, not a guarantee of actual investment results.)
Common Mistakes Beginners Make
Let me share a few mistakes that are common when people are just starting out. The first is getting scared and stopping your contributions when the market drops. Markets naturally move up and down, so a downturn is actually a chance to buy more shares for the same amount of money – it’s worth sticking with your plan calmly through those periods.
The second is chasing a fund just because its price has been rising, only to end up buying in at a peak. Whatever’s getting the most buzz has usually already gone up in price, so don’t let hype drive your decisions – choose something you’re genuinely comfortable with. The third is investing money you actually need for daily living. Investing should only be done with money you can comfortably set aside (funds you won’t need any time soon) – that’s a hard rule worth sticking to.
Wrapping Up
Today we covered how to start investing in three steps: opening an account, choosing your investment, and starting regular contributions. Even starting from just 10,000 yen, sticking with steady contributions lets you grow your wealth over time. Why not take that first step by opening an account, starting at a pace that feels comfortable for you?
Let’s keep at it, slow and steady. See you next time!
* This article is for informational purposes only and does not recommend any specific investment. Please make investment decisions at your own responsibility.
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