How Recent Grads Can Start Investing
It’s easy to think of investing as something only wealthy people can do, it does not need to be like that. Even right out of college, you may want to consider using investing as a tool to secure your future financially. There are several low-impact ways you can get started.
Put Aside a Little Each Month
Depending on the type of investing you want to do, you can likely set aside smaller chunks of money every month instead of trying to save up a large amount. Even if you just put aside $100 or so each month, you can see your funds begin to grow. You can often get smaller portions of shares as well. No matter the state of the economy, the important thing is to get started.
Even a small sum can motivate you to keep an eye on how the market is doing, and you will be able to consider yourself an investor. It can be hard to come up with a sum to set side each month, especially right after college. You may be navigating the adult world for the first time on your own, and you may already be making student loan payments. However, you can reduce some of your monthly spending when you undertake a student loan refinance. That frees up more money to invest.
Get a CD or High-Yield Savings Account
Both CDs and high-yield savings accounts have relatively low risk, and they can greatly increase your savings. The savings accounts can offer a greater amount of interest than what you can get through traditional savings vehicles, and you will still be able to withdraw your funds. You might not think of a certificate of deposit (CD) as an investment, but they can help your money grow and they are insured by the federal government. You can commit your money to the CD for a certain amount of time, so they are an option if you won’t need the funds until sometime in the future. If you are saving for next year’s vacation, you could get a 12- or 18-month CD to store the money away.
Work with a Free Broker
You cannot control things like soaring gas prices or the job market, but you can make some moves to help cushion the blow of a volatile economy. You can work with low-cost or even free brokers who might allow you to make trades for free. Many offer educational tools that will help you learn as you go. There are also platforms that allow you to make trades for free, including cryptocurrency and options. Some even offer retirement options, which is a great option if you are looking to set aside more money than what you can through your employer’s options.
Get an Index Fund
Getting an index fund is easy, and it allows you to hold shares in the index’s stocks. Because you will have so many different stocks, your investment will be more diversified, and the returns are less likely to fluctuate than with other investments. You also don’t need to know very much to start investing, and you can get started with a fairly low commitment of money but of course, only if you feel comfortable to do so.
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