Free checklist
The 10-point checklist before buying your first stock
Most first stock purchases fail not because the company was bad but because the buyer was unprepared. Answer these ten honestly. If any answer is no, that is not failure, it is the checklist working.
- 1
Your emergency fund exists first
Three to six months of essential outgoings in easy-access savings. Without it, a bad month forces you to sell at the worst time, and forced selling is how permanent losses happen.
- 2
This money has a five-year horizon
If you might need it for a house deposit or a wedding within five years, it does not belong in a single stock. Markets fall 20% or more roughly every few years without asking your plans.
- 3
High-interest debt is gone
Clearing a 24% credit card is a guaranteed 24% return. No stock offers that. Anything above roughly 8 to 10% APR should die before you invest.
- 4
You can say what the company sells and who pays
One sentence, no jargon. If you cannot, you are buying a ticker, not a business, and you will not have the conviction to hold it when it falls.
- 5
You know how it makes money, not just revenue
Revenue is applause; profit and free cash flow are money. Check the income statement: is it actually profitable, and is cash coming in the door?
- 6
You have read the numbers, not the headlines
Ten minutes on the financials: revenue direction over five years, margins, debt against equity. SteadyShares shows all of it per stock with each term explained.
- 7
You know why the price is what it is
Look at the P/E against the company's growth and its peers. A high multiple is a promise about the future; know what promise you are underwriting.
- 8
The position is sized to survive being wrong
First position: small enough that a 50% fall changes nothing about your life. For most people that means a low single-digit percent of investable money. You are buying an education first.
- 9
It sits inside the right account
In the UK that usually means a stocks and shares ISA first (£20,000 allowance for 2026/27): no tax on gains or dividends, no paperwork.
- 10
You have written down why you are buying
Two sentences, dated. When the price falls 30% (eventually it will) that note is the difference between a decision and a panic. If the reason breaks, sell. If only the price fell, you get to think clearly.
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Educational information, not financial advice. Figures current as of July 2026 where dated; allowances and rates change, so check the source before acting.