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I’ve been in the personal finance space for years but still, investing in the stock market wasn’t something that I jumped at. Instead, I hesitated for far too long.
I wasn’t sure where to start, what to invest in, or even how to go about it. Now that all seems so silly.
The truth is, it is ridiculously easy to get started, you don’t need to be an “expert”, and you can start investing with as little as ten dollars!
Here are some investing for beginners ideas to get you started. (Even if you have no clue what you’re doing!)
Choose a “Robo-Advisor”
I see a lot of headlines in news stories about the pros and cons of choosing a robo advisor over an in-real-life financial advisor. But the truth is, it doesn’t matter which one you pick. Anything is better than nothing!
Plus, if you don’t have a lot of money to start with, don’t want to pay large fees to financial advisors, and haven’t a clue what you’re doing, going with an online platform can be really great.
I personally love Betterment as my “robo-advisor.” Getting started is simple, there are no minimum contributions, and you can have a retirement or personal investing account up and running in minutes.
Here’s how it works:
Create an account with Betterment
Fill In Your Personal Info
Choose Between a Traditional IRA, Roth IRA, or other type of general savings account
Take a risk assessment
Deposit some money (you choose the amount)
Betterment will invest your money into a diversified portfolio of index funds based on the results of your risk assessment (which you can manually change, by the way)
I started buying individual stocks at the beginning of 2014 and have took a pretty substantial loss based on my choices. My Betterment account, also started in 2014, has a positive return and is crushing my picks.
Going forward I’m going to keep my retirement accounts with a robo-advisor and let them choose the investments for me.
Start Small
Investing is not an all or nothing type of thing. If you’re just getting started you have the option to take it slow.
You could buy one individual stock just to get your feet wet or explore different types of small investment ideas. Do what you need to until you feel comfortable.
The last thing you want to do is invest every single dollar you have in something you know nothing about!
Realize That Investing Goes Beyond the Stock Market
Let’s move beyond the idea that investing means you have to buy into stocks. That’s not true. There are plenty of self-made multi-millionaires who have never put a dime in the stock market.
While I do have some money deposited into my IRA each month the stock market isn’t really my thing. I’d instead to prefer to have a little more control over my investments. I can keep my control by investing in real estate, my business, or myself.
I personally want to be diversified which is why I have money put into an investment account each month but my next goal is to invest in real estate.
All the investment experts tell you to “Invest in What You Know” So keep in mind, that there are many things you can invest in without your money ever touching the stock market.
Take the Confusion Out of Investing
Don’t get tripped up on investing lingo or fancy day trading strategies – you don’t need either to get started investing. Instead keep it simple, start small, and explore investing options that are best suited to your preferences.
Alexa Mason
Alexa Mason is a freelance writer and wanna be internet entrepreneur. She is also a newly single mom to two beautiful little girls. She chronicles her journey as a single mom trying to make it big at www.singlemomsincome.com.
A stock portfolio focused on dividends can generate $1,000 per month or more in perpetual passive income, Mircea Iosif wrote on Medium. “For example, at a 4% dividend yield, you would need a portfolio worth $300,000.
A stock portfolio focused on dividends can generate $1,000 per month or more in perpetual passive income, Mircea Iosif wrote on Medium. “For example, at a 4% dividend yield, you would need a portfolio worth $300,000.
Investing can change your life for the better. But many people mistakenly think that unless they have thousands of dollars lying around, there's no good place to put their money. The good news is that's simply not the case. You can start investing with $100 or even less.
You can certainly start investing with $10 per month, and it's a great way to develop a regular savings habit and gradually build your investment portfolio. While $10 per month may seem like a small amount, it can add up over time through the power of compounding.
Imagine you wish to amass $3000 monthly from your investments, amounting to $36,000 annually. If you park your funds in a savings account offering a 2% annual interest rate, you'd need to inject roughly $1.8 million into the account.
One of the easiest passive income strategies is dividend investing. By purchasing stocks that pay regular dividends, you can earn $2,500 per month in dividend income. Here's a realistic example: Invest $300,000 into a diversified portfolio of dividend stocks.
Investing $100 per month, with an average return rate of 10%, will yield $200,000 after 30 years. Due to compound interest, your investment will yield $535,000 after 40 years. These numbers can grow exponentially with an extra $100. If you make a monthly investment of $200, your 30-year yield will be close to $400,000.
Your Retirement Savings If You Save $100 a Month in a 401(k)
If you're age 25 and have 40 years to save until retirement, depositing $100 a month into a savings account earning the current average U.S. interest rate of 0.42% APY would get you to just $52,367 in retirement savings — not great.
How much you should invest depends on your financial situation, investment goal and when you need to reach it. One common investment goal is retirement. As a general rule of thumb, you want to aim to invest a total of 10% to 15% of your income each year for retirement.
Don't let your current financial situation keep you from saving. Even a small amount of money saved can add up. Setting aside $200 per month is an excellent place to start.
If you don't want to invest your money in the stock market, you have several options to get a return on your money. The lowest-risk options include a high-yield savings account, certificate of deposit, or money market account.
If you have $500 that isn't earmarked for bills, that's enough to get started in investing. It may or may not feel like a fortune to you. But with the right investments, it can certainly be used to start one.
Key Takeaways. Paying down debt or creating an emergency fund is a way to invest $1,000. Investing $1,000 in an exchange-traded fund (ETF) allows investors to diversify and save on transaction costs. Debt instruments like bonds and Treasury bills are low-risk investments that may offer a steady yield.
“Ideally, you'll invest somewhere around 15%–25% of your post-tax income,” says Mark Henry, founder and CEO at Alloy Wealth Management. “If you need to start smaller and work your way up to that goal, that's fine. The important part is that you actually start.”
Hobby: Web surfing, Rafting, Dowsing, Stand-up comedy, Ghost hunting, Swimming, Amateur radio
Introduction: My name is Virgilio Hermann JD, I am a fine, gifted, beautiful, encouraging, kind, talented, zealous person who loves writing and wants to share my knowledge and understanding with you.
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