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How to start investing as a 19-year-old student?
I am a sophomore entering my junior year, and the biggest concern I have right now is how can I start investing into my Fidelity Roth IRA account, what should I do?
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13 answers
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Kent’s Answer
That’s a great mindset to have at 19—starting early gives you a major advantage. Here’s a step-by-step guide on how to start investing in your Fidelity Roth IRA as a college student:
Step 1: Confirm You’re Eligible • You must have earned income. This includes wages from part-time jobs, internships, or self-employment. • You can contribute up to $7,000 in 2024, but only up to your total earned income if it’s less than that.
Step 2: Fund Your Fidelity Roth IRA • Log into your Fidelity account. • Go to your Roth IRA dashboard. • Choose “Make a contribution” and select the tax year (e.g., 2024). • Transfer funds from your bank account.
Step 3: Choose Investments (Don’t Leave It in Cash!) A Roth IRA is just the account—the real growth comes from what you invest in. Consider: Starter Portfolio Options: 1. Target-Date Fund (e.g., Fidelity Freedom 2065 Fund - FFGFX): • Automatically adjusts based on your age. • Great for hands-off investing. 2. Total Market Index Fund (e.g., FSKAX): • Gives you exposure to the entire U.S. stock market. 3. S&P 500 Index Fund (e.g., FXAIX): • Tracks the 500 largest U.S. companies. 4. Dividend Growth Fund (optional for income focus): • Good for long-term income potential. Tip: Start with 1–2 funds, and keep it simple.
Step 4: Set Up Automatic Contributions (If Possible) • Even $25/month helps. • Automate to build consistency and benefit from dollar-cost averaging.
Step 5: Stay the Course • Focus on long-term growth. • Don’t panic during market drops—that’s normal. • Reinvest dividends for compounding.
Kent recommends the following next steps:
Updated
Chiquria’s Answer
First, make sure you're eligible to contribute. Roth IRAs need to be funded with money you've earned from a job or internship. You can put in as much as you've earned, up to $7,000 for the tax year 2024. Once you're ready, log in to your Fidelity account and add funds to your Roth IRA by transferring from your checking or savings account. Keep in mind, depositing money doesn't mean it's invested yet—it will sit in a default money market account until you choose specific investments.
When deciding what to invest in, think about beginner-friendly choices like target-date retirement funds, which automatically adjust based on when you plan to retire. You might also consider total market index funds like FSKAX or FXAIX, or diversified low-cost ETFs (exchange-traded funds). These options are excellent for long-term growth. If you have a regular income, setting up automatic contributions and reinvesting dividends can help you stay on track and make the most of compound growth over time.
Keep learning as you go. Resources like Fidelity’s Learning Center, Investopedia, and NerdWallet offer great information to boost your confidence in your investment strategy. Remember, Roth IRAs are designed for retirement savings. Taking out earnings too early can lead to penalties, so be sure to understand your time horizon and risk tolerance. Most importantly, start with what you can, keep at it, and watch your savings grow!
When deciding what to invest in, think about beginner-friendly choices like target-date retirement funds, which automatically adjust based on when you plan to retire. You might also consider total market index funds like FSKAX or FXAIX, or diversified low-cost ETFs (exchange-traded funds). These options are excellent for long-term growth. If you have a regular income, setting up automatic contributions and reinvesting dividends can help you stay on track and make the most of compound growth over time.
Keep learning as you go. Resources like Fidelity’s Learning Center, Investopedia, and NerdWallet offer great information to boost your confidence in your investment strategy. Remember, Roth IRAs are designed for retirement savings. Taking out earnings too early can lead to penalties, so be sure to understand your time horizon and risk tolerance. Most importantly, start with what you can, keep at it, and watch your savings grow!
Updated
Michelle’s Answer
Hello, Aisha !
It's great that you have taken an interest in investments while being a college student living in New York. When you set up your IRA, the bank must have given you literature that explains everything that you can do with the IRA, so it's best to refer to the bank's information for your IRA. That would be the best guide.
You are very fortunate to be able to have an IRA and able to contribute to it under your circumstances. Most students are concerned about how they would pay back their student loans. I assume that you are living with parents and do not have to be concerned about housing or rent. Everything in your city is super duper expensive, so if you can actually spend and contribute money while going to college and paying the tuition, you are truly exceptional. You can contribute earned income but not monies from Scholarships or Grants you receive in college. Talk to your bank in December to see if you have to file an Income Tax Return to report your contributions.
Since this investment is your biggest concern right now as you've mentioned, I would also advise focusing on your college courses and doing projects that will give you experience for the future. That is quite important, too. You will have many decades to contribute to your IRA, so try not to worry about it too much.
Best wishes in all you do !
It's great that you have taken an interest in investments while being a college student living in New York. When you set up your IRA, the bank must have given you literature that explains everything that you can do with the IRA, so it's best to refer to the bank's information for your IRA. That would be the best guide.
You are very fortunate to be able to have an IRA and able to contribute to it under your circumstances. Most students are concerned about how they would pay back their student loans. I assume that you are living with parents and do not have to be concerned about housing or rent. Everything in your city is super duper expensive, so if you can actually spend and contribute money while going to college and paying the tuition, you are truly exceptional. You can contribute earned income but not monies from Scholarships or Grants you receive in college. Talk to your bank in December to see if you have to file an Income Tax Return to report your contributions.
Since this investment is your biggest concern right now as you've mentioned, I would also advise focusing on your college courses and doing projects that will give you experience for the future. That is quite important, too. You will have many decades to contribute to your IRA, so try not to worry about it too much.
Best wishes in all you do !
Updated
Lois’s Answer
Aisha,
Kent's answer was very thorough on the concrete steps to fund a Fidelity account Roth IRA. I admire your forward thinking in establishing a Roth IRA so early in life!
I have found the Fidelity advisors to be very helpful. Should you need more guidance on selecting funds or setting up direct deposit (automatic contributions), I suggest contacting them directly. If you have a local branch in NY where you can establish a relationship with an advisor (again, should be free), that would be even better!
This is the toll free number I found online: 1-800-343-3548.
Happy Investing!
Kent's answer was very thorough on the concrete steps to fund a Fidelity account Roth IRA. I admire your forward thinking in establishing a Roth IRA so early in life!
I have found the Fidelity advisors to be very helpful. Should you need more guidance on selecting funds or setting up direct deposit (automatic contributions), I suggest contacting them directly. If you have a local branch in NY where you can establish a relationship with an advisor (again, should be free), that would be even better!
This is the toll free number I found online: 1-800-343-3548.
Happy Investing!
Updated
Diana’s Answer
Hi Aisha,
I'm glad you're interested in this. There are many options for opening a Roth IRA with different companies. In 2024, you can contribute up to $7,000, or as much as you've earned. It's a good idea to decide on a set amount or percentage to contribute from each paycheck. Many places let you set up automatic payments, so you can have money taken out monthly, weekly, or every two weeks.
Also, consider investing the money in your Roth IRA instead of leaving it as cash. You can choose automatic investments where the company picks for you, or you can learn more about investments and choose yourself. You might also want to talk to an advisor for guidance.
I'm glad you're interested in this. There are many options for opening a Roth IRA with different companies. In 2024, you can contribute up to $7,000, or as much as you've earned. It's a good idea to decide on a set amount or percentage to contribute from each paycheck. Many places let you set up automatic payments, so you can have money taken out monthly, weekly, or every two weeks.
Also, consider investing the money in your Roth IRA instead of leaving it as cash. You can choose automatic investments where the company picks for you, or you can learn more about investments and choose yourself. You might also want to talk to an advisor for guidance.
Updated
Ekaterina’s Answer
Hi Aisha,
Step 1: Log in to Your Fidelity Account
Go to fidelity.com and sign in.
Click on “Accounts & Trade” > “Portfolio”.
Click on your Roth IRA account.
Step 2: Fund Your Roth IRA
If you haven’t added money yet:
Click “Transfer” or “Add Funds”.
Choose to transfer from your bank.
Enter the amount (e.g. $50 or $100).
Select Roth IRA as the destination.
Confirm
Step 3: Pick Your Investment (Simple ETF)
Now that your Roth IRA has cash, it’s not yet invested — it just sits there until you buy something. Here’s what to do:
Option A (EASY): Buy a total market index fund like
FXAIX or FSKAX
Go to your Roth IRA account.
Click “Trade” > “Trade Fidelity Mutual Funds”.
Search for FXAIX (S&P 500 index fund, zero fees) or FSKAX (total US stock market).
Choose Buy, enter the amount, and place the order.
Option B (ETF style): Buy VTI
(Vanguard Total Market ETF)
Click “Trade” > “Trade Stocks/ETFs”.
Type VTI, select it.
Choose how many shares (start with 1 if you can).
Choose Market Order and “Buy”.
Click Preview Order, then Submit.
Step 1: Log in to Your Fidelity Account
Go to fidelity.com and sign in.
Click on “Accounts & Trade” > “Portfolio”.
Click on your Roth IRA account.
Step 2: Fund Your Roth IRA
If you haven’t added money yet:
Click “Transfer” or “Add Funds”.
Choose to transfer from your bank.
Enter the amount (e.g. $50 or $100).
Select Roth IRA as the destination.
Confirm
Step 3: Pick Your Investment (Simple ETF)
Now that your Roth IRA has cash, it’s not yet invested — it just sits there until you buy something. Here’s what to do:
Option A (EASY): Buy a total market index fund like
FXAIX or FSKAX
Go to your Roth IRA account.
Click “Trade” > “Trade Fidelity Mutual Funds”.
Search for FXAIX (S&P 500 index fund, zero fees) or FSKAX (total US stock market).
Choose Buy, enter the amount, and place the order.
Option B (ETF style): Buy VTI
(Vanguard Total Market ETF)
Click “Trade” > “Trade Stocks/ETFs”.
Type VTI, select it.
Choose how many shares (start with 1 if you can).
Choose Market Order and “Buy”.
Click Preview Order, then Submit.
Updated
Devin’s Answer
Hello Aisha,
I think it is awesome how you are already interested into investing your money. They say to build wealth is to have your money start working for you. I understand that you would like to start investing into Fidelity Roth IRA. I personally use Fidelity as well which is convenient for answering this question. I personally recommend investing into mutual funds or ETFs for your Roth IRA. Since Roth IRA is your retirement account, it is best to invest into things that will gradually but for sure go up. I invest into SPY which tracks the S&P500 index, which has an average annual return rate of 9.8% since 1928. So, I would most definitely recommend investing into safe stocks for your Roth IRA.
Devin Tran
I think it is awesome how you are already interested into investing your money. They say to build wealth is to have your money start working for you. I understand that you would like to start investing into Fidelity Roth IRA. I personally use Fidelity as well which is convenient for answering this question. I personally recommend investing into mutual funds or ETFs for your Roth IRA. Since Roth IRA is your retirement account, it is best to invest into things that will gradually but for sure go up. I invest into SPY which tracks the S&P500 index, which has an average annual return rate of 9.8% since 1928. So, I would most definitely recommend investing into safe stocks for your Roth IRA.
Devin Tran
Updated
Rebecca’s Answer
Once you have the money in the account, you would need to know which investment is good for you, mutual fund, ETF, stocks.
I would recommend doing S&P 500 based fund if you don't know how to invest.
I would recommend doing S&P 500 based fund if you don't know how to invest.
Updated
Alejandra’s Answer
Aisha!
That’s great that you’re thinking about investing early—starting at 19 puts you way ahead of the game! If you already have a Fidelity Roth IRA, you’re off to a strong start. Here’s how to move forward:
1. Fund Your Roth IRA
2. Choose Your Investments
3. Set a Regular Schedule
4. Think Long-Term
5. Learn As You Go
That’s great that you’re thinking about investing early—starting at 19 puts you way ahead of the game! If you already have a Fidelity Roth IRA, you’re off to a strong start. Here’s how to move forward:
1. Fund Your Roth IRA
2. Choose Your Investments
3. Set a Regular Schedule
4. Think Long-Term
5. Learn As You Go
Updated
David’s Answer
It's great that you're thinking about saving for retirement early. Here's a fact: if you invest $2,000 each year for just 6 years in a stock market index fund, you'll have $1 million by age 65, even if you don't save any more after that. This shows how crucial it is to start investing early.
Updated
Jackson’s Answer
Hey Aisha,
Since most people before me answered on how to start putting money into an actual account, I'll provide you with an answer on how to pick your first stocks and getting started.
I was in junior year of high school when I first got into investing, and I think the most important thing here is to get in as early as possible. There is a concept called compounding, where your returns begin generating their own returns over time, and the earlier you start, the larger it can grow.
Here's a quick example that shows this concept:
- Let’s say you put in $100 and earn 10 percent a year.
- After Year 1, you have $110.
- In Year 2, you earn 10 percent on $110, so you end up with $121.
- In Year 3, you earn 10 percent on $121, which gives you $133.10.
Here's another example of how much of a difference investing earlier can have:
If you held the an investment of $1000 in the S&P 500 (investing into an index of 500 major U.S. companies) until age 50:
- Starting at age 18 (32 years invested) would give you about $21,114.
- Starting at age 20 (30 years invested) would give you about $17,449.
- The difference is about $3,664, which is roughly 21 percent more by starting just two years earlier.
Each year, you’re earning interest on the money you started with and the interest you’ve already made. That’s compounding—it’s like a snowball rolling downhill, getting bigger and bigger.
You don't need to touch that money once its invested, just let it sit and watch it grow.
Also, I first became introduced to investing through Warren Buffets ideology of value investing: https://www.investopedia.com/articles/01/071801.asp
Here's a short summary of it: Warren Buffett’s value investing strategy is about buying companies for less than what they are really worth by looking at things like their profits, debt, and overall performance. He focuses on strong businesses he believes will grow over time, rather than worrying about short-term market ups and downs.
If you are just starting out, focus on investing in companies you believe in, that have stood the test of time, and that make products or services you notice being used everywhere. When you are new to investing, keep it simple and avoid getting too fancy with complicated strategies or risky picks.
Since most people before me answered on how to start putting money into an actual account, I'll provide you with an answer on how to pick your first stocks and getting started.
I was in junior year of high school when I first got into investing, and I think the most important thing here is to get in as early as possible. There is a concept called compounding, where your returns begin generating their own returns over time, and the earlier you start, the larger it can grow.
Here's a quick example that shows this concept:
- Let’s say you put in $100 and earn 10 percent a year.
- After Year 1, you have $110.
- In Year 2, you earn 10 percent on $110, so you end up with $121.
- In Year 3, you earn 10 percent on $121, which gives you $133.10.
Here's another example of how much of a difference investing earlier can have:
If you held the an investment of $1000 in the S&P 500 (investing into an index of 500 major U.S. companies) until age 50:
- Starting at age 18 (32 years invested) would give you about $21,114.
- Starting at age 20 (30 years invested) would give you about $17,449.
- The difference is about $3,664, which is roughly 21 percent more by starting just two years earlier.
Each year, you’re earning interest on the money you started with and the interest you’ve already made. That’s compounding—it’s like a snowball rolling downhill, getting bigger and bigger.
You don't need to touch that money once its invested, just let it sit and watch it grow.
Also, I first became introduced to investing through Warren Buffets ideology of value investing: https://www.investopedia.com/articles/01/071801.asp
Here's a short summary of it: Warren Buffett’s value investing strategy is about buying companies for less than what they are really worth by looking at things like their profits, debt, and overall performance. He focuses on strong businesses he believes will grow over time, rather than worrying about short-term market ups and downs.
If you are just starting out, focus on investing in companies you believe in, that have stood the test of time, and that make products or services you notice being used everywhere. When you are new to investing, keep it simple and avoid getting too fancy with complicated strategies or risky picks.
Updated
Steven’s Answer
First off, I love having young people want to learn about investing as it is critical to start thinking about this when you are young. To start a Roth account, you can leverage some free online companies (such as ETrade or Charles Schwab) to assist you with setting up your account. One of the key points in Roth investment account is there are penalties for withdrawing from a Roth fund before you turn 59.5 with the exception of the primary amount you have contributed. All my kids have Roth Accounts and the advice that I give them also is to invest in Roth fund as much as you can afford and only put in the amount that you will not need until you reach 59.5 years of age. But in emergency situations, you can pull out your original contributions without penalty. Separate to this I always advise them to accumulate and build a nest egg for rainy days to cover your current living expenses, if you have any (6 months of savings to cover your fixed and variable expenses required to live). Excess cash should never be left in a general savings account but could be invested in online high yield savings accounts that also can generate circa 4% annual yields or potentially IRS bonds or funds.
Updated
Michael’s Answer
Aisha,
You've gotten some fantastic advice! Starting with an ETF that tracks a broad index is a smart move. There are many books out there to help you understand the basics of investing. As you grow more confident and knowledgeable, you'll likely want to explore specific sectors and individual stocks. It can be exciting to choose a stock you're familiar with and follow its progress. Remember, staying diversified is important to manage risk. As you embark on your financial journey, always remember to pay yourself first and include it in your budget. You're on the right path!
You've gotten some fantastic advice! Starting with an ETF that tracks a broad index is a smart move. There are many books out there to help you understand the basics of investing. As you grow more confident and knowledgeable, you'll likely want to explore specific sectors and individual stocks. It can be exciting to choose a stock you're familiar with and follow its progress. Remember, staying diversified is important to manage risk. As you embark on your financial journey, always remember to pay yourself first and include it in your budget. You're on the right path!