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should i invest in myself at 18 or wait till i turn 21?

#investment-banking #financial-services #finance #investment-management #investing

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Jason’s Answer

Hi Paul,

Short answer: Any competent financial advisor will tell you to always invest sooner than later. This is a fundamental law of investment and compound interest. The more time your investment has to compound the better off you will be.

Longer answer: Most high school and even college students typically do not have the financial resources to do much investing. If you do great! As a younger investor you have time on your side. As such you can invest much more aggressively that perhaps someone who is nearing retirement. All financial investments have some level of risk but if you do stumble in a poor investment choice when young you can often make it up down the road whereas older investors don't have than luxury to. One example of this would be Dogecoin. Many financial advisors would call Dogecoin a risky investment but it has seen incredible growth recently. But for every Dogecoin there are a number of others that have tanked or hardly move at all.
Remember that monetary investment is only one form of personal investments that matter. Education is often considered an investment as it will often (but not always) pay dividends down the road or accelerate your career. Taking the time to exercise and eat healthily can also be considered an investment in yourself as you will statistically live healthier and longer. Investing time in relationships that matter can pay of in unimaginable ways - though rarely financially. Money is an important resource, but just remember that your financial portfolio is only one facet of your life - be careful that you don't neglect the others.

-Best of luck to you!
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Meggan’s Answer

As the other responses have indicated, it is never too early to start investing. One of the key things to learn is the power of compounding. The following article may help.... https://grow.acorns.com/compounding-penny-doubled/. The more you start putting into savings or investments now, the sooner you will begin to benefit from the powerful impact of compound interest. There are also a lot of good tools available to help learning the benefits of budgeting, with investments being an important portion of one's financial plans. I would definitely advise to get started as soon as you can!
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William Barrett’s Answer

Its never too early to start investing, and the earlier the better! Because of the way money compounds over time when invested, starting with even just a small amount can turn into a lot over the long run. If you're unsure about what to invest in and think you will be more knowledgable about it when you are 21, look for a safe short term investment so that your money can grow while your investing skills are also growing so that when you are ready to really start investing, you will have a good little nest egg to start seriously playing around with. For example, look at some ETF's that track an index (like the S&P 500) to put your money in. These products have low expense ratios and also have the potential for some good growth. Hope this helps!
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James’s Answer

like many previous answers, the earlier you invest is always better! the longer time you have invested in a particular mutual fund or stock the longer you have to capitalize on compound interest. Over time, your investment should grow and as you contribute more funds to that investment, you are compounding the amount of gains that are possible. That can be a big help as you get closer to retirement. Always remember to invest wisely, not trying to take the "get fast" approach as that will always never pan out. Invest in companies that you research and are familiar with. Alot of online sites have information about different sectors and companies that you can rely on for more information.
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Reagan’s Answer

It is never too early to start investing in yourself. Time is our most finite resource, so spend it wisely. If you can do something now to set your future self up for success, consider it! As was posted before, this encompasses multiple elements of life. Think of your financial, physical, and mental health.

Financially, begin investing in a career that will allow you the lifestyle you want for yourself, without sacrificing your current passions. Keep in mind that not every job will be your "dream job", but if they allow you the freedom to pursue your passions outside of working hours, it may be a good short-term investment. Take advantage of 401k-matching from your first day on the job & you'll be shocked by how quickly and easily you can begin building wealth for retirement.

That being said, there are things you can do to take control of your financial future outside of your career. Real estate is a strong investment with time on your side. This can be done with as little as 3.5% down. I have found "house hacking" at a small scale to be very attainable. Taking this approach can help cover parts of your monthly payment, so you are building generational wealth with a huge financial asset, for very little upfront and a small monthly contribution. This is likely money you would be using to rent anyway, so this is a great way to make your money work for you!

Physically & mental health cannot be neglected in your investments. It is unlikely that you will ever regret a good workout, a good meal, or time spent with those you love. Invest in relationships that bring you support and joy. Invest in your body, the only body you will ever receive. Spend time and money in the gym, on challenging hobbies, and even counseling/guidance when needed. Invest your time and money on things that have a positive return on investment financially, physically, and mentally.
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Samantha’s Answer

I would do it as soon as possible just in case an emergency happens or something comes up. I use the stash app. When I make a purchase it rounds up to the nearest dollar and invests it in stock of your choosing.
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Nicholas’s Answer

Hey Paul,

I think it's never to early to start investing in yourself, and the earlier the better. I've that I'm a creature of habit, and being able to start good habits when you're young can end up with life long rewards. Whether it's starting working out or learning a new hobby the earlier you start investing in yourself by creating those habits the harder it will be for those good habits to be broken.
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Hassan’s Answer

There is no specific age or time where an individual can invest, personally i believe that it is never too early and you should start investing as soon as you possibly can.
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Luis’s Answer

Hi Paul!

It depends on what you call investing in yourself. I think that a lot of times, we look to invest in the tangible stuff (Clothes, cars, etc) which as you know these are things that are temporary. Truly investing in yourself would be in your overall wellbeing - health, emotional, knowledge.

I hope this helps.
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Jonathan’s Answer

You should absolutely start when you're 18, the earlier the better! Those 3 years that you started between 18-21 could translate to thousands, if not hundreds of thousands, of dollars when you're age 50+. Never wait or create fictitious starting points for yourself, because you'll always find yourself creating new start dates (e.g. "oh when I turn 21," "oh once I finish college," "oh once I buy a house"). There's always another milestone in life to be achieved, but start investing now and never stop. Work your expenses into the equation after your savings goals are reached!
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Katelyn’s Answer

A great book you can read is "The Simple Path to Wealth" by JL Collins. It goes in to the why, when and what of investing and gives some practical examples. A big take-away is the sooner you invest financially or even simply save, the sooner you are giving yourself freedom to take a break from work, or whatever it is. If you prefer to not live hand-to-mouth, this is a paramount principle to adopt. Good luck!
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Audrey’s Answer

Absolutely, the sooner you start the better. And it can always be something small and look to grow it over time!
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James’s Answer

Hi. Do not hesitate to start investing in yourself. Investing in yourself means different things to different people but do not wait. Investing in yourself is always improvement, whether it be educational, health, financial or a multitude of other things. Take time to internally reflect and find what matters to you, what are your goals, what are your priorities (these are not the same thing). At a young age it is hard to know all these answers but find something that challenges you, that will make you want to improve every day. Improvements can be spending 15 minutes a night reading up how to start a business or finding 30 minutes to exercise at home. The road to improvement begins when you are ready to begin.
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Hilda’s Answer

You definitely should invest in yourself as early as possible. No need to wait.
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Michelle’s Answer

The earlier you can start saving and investing, the better it'll be for you in the long haul. Compound interest will be your friend.

You can start by opening a Roth IRA and saving a portion of your income every month to it. What's good about Roth IRA is that your money grows tax free because the money you're investing is already after tax.

Here's a website that talks about Roth IRA FAQs - https://www.ramseysolutions.com/retirement/roth-ira-101.

Michelle recommends the following next steps:

https://www.ramseysolutions.com/retirement/roth-ira-101
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Cameron’s Answer

I would recommend investing as early as possible! Even investing just a small amount of money can be worthwhile.

I'm no stock expert, but investment websites like E*trade and Vanguard are great places to start! They make investing in stocks or mutual funds pretty easy to understand.

If you are working and your employer offers you a 401k plan, I would also recommend setting aside some of your paycheck to your retirement account. Even though your take-home pay will decrease, that amount you put aside will grow and help you in the future.
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