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How do I get started?
I'm turning 18 in December and I want to start to learn more about investing, etc
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9 answers
Updated
Ashish’s Answer
Its always good to start investing at a young age. Talk to your parents openly and start out investing small with low risk bonds and companies. Mutual funds are great and grow significantly.
By investing when you're still a teenager, you'll build an incredibly broad investment portfolio a lot sooner than you think.
Important to talk to your parents or elders as the first thing you need to know is all the risks involved. Lot of articles available online as well. My advice is do lot of homework before getting into investing - understand the value for money and risks involved and then you will be all set.
By investing when you're still a teenager, you'll build an incredibly broad investment portfolio a lot sooner than you think.
Important to talk to your parents or elders as the first thing you need to know is all the risks involved. Lot of articles available online as well. My advice is do lot of homework before getting into investing - understand the value for money and risks involved and then you will be all set.
Updated
Jake’s Answer
It's great that you're asking this question now. Given America's DIY retirement system, everyone needs basic investing and savings skills whether they work in Finance or not.
For most people, there's no such thing as short-term investing. Get rich quick schemes don't work as a personal investor. Your goal should be to save money slowly and steadily over decades, not years.
Start a habit of saving money into an IRA (Individual Retirement Account). Set up a regular monthly contribution. It's ok if it's a small amount, do whatever is possible for your situation. Just start to build the habit of setting aside this money, it'll slowly add up over time. You can open a free IRA at any number of brokerages, but I recommend Vanguard because of their low costs, simplicity, and business management style:
- https://investor.vanguard.com/ira/iras
There's a ton of depth to be explored here, but for starters here are a few key rules to keep in mind:
1) Buy cheap mutual funds that try to match the market, like Vanguard Target funds.
2) Pay attention to fees. A 1% fee vs. a 0.1% may not sound like much, but can add up to enormous differences in earnings over time.
- In this vein, avoid any actively managed funds. They don't beat the market over the long run, you just wind up paying more for subpar performance. Stick to index funds that just try to match the market.
3) Never buy an individual security (for example, buying a Netflix stock on Robinhood). This is gambling, not investing.
4) Maximize tax advantaged accounts like Roth accounts to keep more of your money.
5) Save what you can slowly and consistently over time. Compound interest is the most powerful weapon you have, starting at 18 is a fantastic way to get it on your side.
There's a ton more to cover, but hopefully this offers some good first steps. Best of luck!
Open a Roth IRA: https://investor.vanguard.com/ira/iras
Build a small habit and keep it consistent. Increase your savings as you can over time, try to save 15-20% of your income when you can.
Read books on investing & economic security. I recommend Theresa Ghilarducci, Helaine Olen, Jack Bogle, and Benjamin Graham's works. Stay away from personal finance gurus, they're more hype than reality.
For most people, there's no such thing as short-term investing. Get rich quick schemes don't work as a personal investor. Your goal should be to save money slowly and steadily over decades, not years.
Start a habit of saving money into an IRA (Individual Retirement Account). Set up a regular monthly contribution. It's ok if it's a small amount, do whatever is possible for your situation. Just start to build the habit of setting aside this money, it'll slowly add up over time. You can open a free IRA at any number of brokerages, but I recommend Vanguard because of their low costs, simplicity, and business management style:
- https://investor.vanguard.com/ira/iras
There's a ton of depth to be explored here, but for starters here are a few key rules to keep in mind:
1) Buy cheap mutual funds that try to match the market, like Vanguard Target funds.
2) Pay attention to fees. A 1% fee vs. a 0.1% may not sound like much, but can add up to enormous differences in earnings over time.
- In this vein, avoid any actively managed funds. They don't beat the market over the long run, you just wind up paying more for subpar performance. Stick to index funds that just try to match the market.
3) Never buy an individual security (for example, buying a Netflix stock on Robinhood). This is gambling, not investing.
4) Maximize tax advantaged accounts like Roth accounts to keep more of your money.
5) Save what you can slowly and consistently over time. Compound interest is the most powerful weapon you have, starting at 18 is a fantastic way to get it on your side.
There's a ton more to cover, but hopefully this offers some good first steps. Best of luck!
Jake recommends the following next steps:
Updated
Doc’s Answer
Yesterday Garvin. But if you haven’t started yet, today is a great second choice. One of the scariest things about making investments for beginners is the volatility of the stock market. When you see your funds temporarily go down, you may be tempted to pull your money and keep it in a no-risk savings account. In general, you want to start investing as soon as you have a solid financial base in place. This includes having no high-interest debt, an emergency fund in place, and a goal for your investments in mind. Doing so allows you to leave your money invested for the long-term – key for maximum growth – and be confident in your investment choices through the natural ups and downs of the market. Compound growth requires time. The earlier you start investing, the more wealth you can create with fewer dollars. When it comes to investing, time is your most powerful tool. The longer your money is invested, the longer it has to work to create more money and take advantage of compound growth. It also makes it far less likely that one harsh market downturn will negatively impact your wealth as you’ll have time to leave the money invested and recover its value.
The best investment apps aim to make investing more accessible for anyone, especially beginners. If you are curious about investing for the first time, apps with low minimums and affordable fee structures can be a great way to get started. For example, through Acorns and Ally, you can start investing your extra money straight from your smartphone. Other beginner apps, like Robinhood, allow you to learn about investments before you get started with your own funds. The features offered by beginner-friendly apps can enable you to learn how to invest without going through a financial advisor, risking your savings, or even spending significant time researching ahead of time. The key is to find an app that is compatible with your learning style and go from there.
Hope this helpful Garvin
Acorns is a great investment app for beginners. This app is especially useful if you want to bolster your savings and invest without even thinking about it. The app integrates with your credit or debit card and rounds up purchases to automatically add funds to an investment account. Acorns allows you to invest in EFTs and a few fractional shares in stocks. There are three tiers (lite, personal, and family) allowing users to add additional accounts for a premium rate.
Stash is one of the best apps for beginners hoping to learn the ropes of investing fast. The app mixes educational content and games to make financial topics easier to learn. Users can customize goals based on what they want to focus on, and can actively track their progress. Stash lets you work with value-based investment offerings and provides suggestions for building your portfolio.
Ally invest is a great option for beginners interested in stocks and bonds. This app integrates real time data to allow users to trade anytime, anywhere. Ally invest also gives users access to bonds, mutual funds, and EFTs. There is no minimum investment, and the app doesn’t require additional downloads to access the trading platform (making it very user friendly).
Robinhood gained popularity as one of the first apps to offer stock trading without fees or commissions, which made starting a stock portfolio a lot more attractive for first-time investors. Today, there are several apps with this same offering, but Robinhood still stands out for a few reasons. First, the app allows users to trade cryptocurrency without fees. Robinhood also has no minimum account balance and no inactivity fees. Its user-friendly interface also makes it stand out among other web-based trading platforms. There are a few drawbacks to keep in mind, for example, Robinhood doesn’t sync with retirement accounts and has limited customer support. But given its user-friendly interface and nonexistent fee structure, Robinhood remains one of the best stock market apps.
The best investment apps aim to make investing more accessible for anyone, especially beginners. If you are curious about investing for the first time, apps with low minimums and affordable fee structures can be a great way to get started. For example, through Acorns and Ally, you can start investing your extra money straight from your smartphone. Other beginner apps, like Robinhood, allow you to learn about investments before you get started with your own funds. The features offered by beginner-friendly apps can enable you to learn how to invest without going through a financial advisor, risking your savings, or even spending significant time researching ahead of time. The key is to find an app that is compatible with your learning style and go from there.
Hope this helpful Garvin
Doc recommends the following next steps:
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NITISH’s Answer
Hi Garvin. Glad that you're thinking about investing at the young age. The earlier you start the better. I've read a few books in the last few years on financial management but following two books are my top picks. Definitely recommend for anyone who's planning to get started in the world of investing.
1) I'll teach you to be rich (will help provide guidance on basic investing: 401K, Roth IRA, Stock Market, Bonds, etc.)
2) Rich dad poor dad (not directly about investing but helps to understand real value of money and how to earn it)
Hope this helps!
Thanks,
Nitish
1) I'll teach you to be rich (will help provide guidance on basic investing: 401K, Roth IRA, Stock Market, Bonds, etc.)
2) Rich dad poor dad (not directly about investing but helps to understand real value of money and how to earn it)
Hope this helps!
Thanks,
Nitish
Updated
Michael’s Answer
It is great to hear that you're interested in investing. As others have mentioned, it is very important to do your research before jumping in so you can understand the risks involved, and just as importantly, what goals you have by investing. Aside from the resources already mentioned, I've found Investopedia (https://www.investopedia.com/) to have some very good articles about different investment topics.
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Thomas’s Answer
I would recommend that before you start by doing some research and reading before you start buying stocks. I would recommend looking into index funds as a good place to start. They are generally safer than individual stocks and you can often trade them commission free. It is important to know the fee structure the broker that you use.
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Simeon’s Answer
Start off with educating yourself on financial topics. Check out Two Cents on YouTube and Dave Ramsey's websites. They've both got a lot of helpful information. If you are looking to play with investing just a little bit, check out the RobinHood app. If you're looking at actually getting started with investing, I'd say take a loot at ETFs. They're packages of pretty safe stocks that you are designed by large stock companies that you can get with only a minimal fee. They have pretty reliable returns.
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Richie’s Answer
To add to Ashish's answer, there is a free resource that PBS put together on their YouTube channel that covers financial literacy topics like investing (https://www.youtube.com/channel/UCL8w_A8p8P1HWI3k6PR5Z6w). I highly recommend them!
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Ryan’s Answer
Hi Garvin,
There are a lot of great specific answers here, so I will keep mine a bit more general. Read, read, read, and read some more. Information is power in anything you want to do. I bought some books on the market when I was around your age, I read Motley Fool every day and listen to their podcast, and I watch Bloomberg television. The point being, just start learning everything you can about investing and then begin to slowly start experimenting with it.
Best of luck!
Ryan
There are a lot of great specific answers here, so I will keep mine a bit more general. Read, read, read, and read some more. Information is power in anything you want to do. I bought some books on the market when I was around your age, I read Motley Fool every day and listen to their podcast, and I watch Bloomberg television. The point being, just start learning everything you can about investing and then begin to slowly start experimenting with it.
Best of luck!
Ryan