How to Start Investing Without Looking Like a Rookie

Did you know that 21% of Americans have nothing saved for retirement? Even those who have managed to save average under $85,000–far less than the average retiree will need.

We’ve all heard how important it is to save and invest, but where do you start?

Don’t worry. You don’t need a Ph.D. in finance to understand how to get started investing.

In this post, we’ll explain how to start investing in four easy steps. Read on to learn more!

  1. Make a Habit of Saving

If you’re among the 1 in 5 Americans with no savings at all, your first step is to start a new habit.

Saving money may seem like a daunting or even impossible task, but that’s not true. Even if you can only save a few dollars a week, it will begin to add up over time. $10 a week for 52 weeks will total over $500 by the end of the year!

Stash some cash away every week in an envelope, shoebox, or another safe place. Or you could place it in a savings account that’s not linked to your checking account (otherwise you’ll be tempted to spend it).

  1. Take Advantage of That 401(k)

If your company offers a 401(k) program, you need to sign up for it. It’s as simple as that.

A 401(k) is like getting an automatic raise without doing any extra work. And if you regularly add to the account, your employer is obligated to match the amount. Think about it–it’s free money!

Over the course of your working years, it can add up to hundreds of thousands of dollars. If you’re wondering where to start investing, this is the obvious choice.

  1. Download an Automatic Investing App

What if, despite your best efforts, you just can’t seem to stick to a habit of saving?

You’re in luck. These days, there are investment apps that do the work for you.

Our favorite app is Acorns, which takes your spare change and invests it across diversified stocks and bonds. You can maximize your savings by setting up automatic contributions or roundups from your debit and credit cards.

  1. Try Low Initial-Investment Mutual Funds

Once you’re used to the idea of investing, the next logical step is mutual funds. With one easy transaction, you can invest your money into a portfolio of stocks and bonds.

Depending on the company, you may be able to start by investing as little as $500. This makes it a perfect option for new investors who don’t have a lot saved up (yet).

If you’re stuck on how to get started, talk to your human resources department or set up a meeting at your local bank. You can also use sites like RedHotFX to help you better understand the world of investments.

How to Start Investing: Now You Know

It’s a common misconception that you need a lot of money to make money.

The truth is that most investors start small and build their wealth over time. You can too, now that you know how to start investing in your future.

For more helpful tips on investing, check out our latest posts on the topic.

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