If you’ve heard the phrase, “Every little bit helps,” used in everyday life, the same goes for beginning to invest your money. When conjuring images of investing money, most people think of Wall Street in New York City, where business men in three-piece suits stare frantically at screens and make irate phone calls. Of course, this is anxiety-inducing for any investing beginner. But the truth is, no matter who you are or how much money you have, you don’t need to buy a fancy suit and move to New York to begin investing your money.
Most people have monthly bills to contend with. Rent is due at the beginning of the month, as well as other build such as car insurance, medical bills, and title loans payments and any other expense that can pop up as you seek reliable transportation to work or emergency funding during a tough time, and maybe your student loans aren’t paid-off yet. But before we begin talking about investing your money, there are a few small changes you can make in your daily and weekly routines that will leave your bank account smiling. For investment advice you can check Capitalist Exploits Insider
Making coffee at home rather than stopping by your local café can save anywhere from $10 to $40 dollars a week, and making a meal at home with your family rather than ordering out frequently not only is a great way to spend time with those you love, but also makes an impact on your wallet.
These small changes will soon be reflected in your bank account, and with that extra money you can open a savings account and begin investing in the way best for your short-term and long-term needs.
Start Investing Regardless of Wealth
1. Consider an Online Savings Account
With that extra money being set aside each month, you might think putting it under your mattress or away in a closet is a good way to start. Putting money away is a great idea, but once that money stash begins to get a little too thick to hide at home, there are online savings accounts that offer strong APYs, or yearly compound interest. After a year, your online stash will be a healthy sum that has benefitted from snowballing interest and you can begin shopping around for the best investment opportunity to take advantage of.
2. Have Technology Take the First Step for You
Rather than jumping into the world of investment head-first, there are electronic and app-based methods for the first-time investor.
For instance, the app called Acorns rounds all of your purchases up to the nearest dollar and then goes on to invest that money for you.
Another option that invests money for you are robo-advisors that use algorithms in order to invest your money in the best, most profitable way possible. This has opened the playing field to all investors, new and experienced, and your money will be safe with these intelligent advisors, all while you pay lower fees and costs.
3. Don’t Be Scared of Real Estate Crowdfunding
When thinking about real estate investment, you may think of millionaires and billionaires who can pay for a house on a whim, and in cash. But, similar to how robo-advisors have evened the playing field, real estate crowdfunding has done the same. This gives people the chance to invest in real estate without being responsible for maintenance or upkeep. New platforms, like Fundrise, make it incredibly easy to invest as little as $500 so you can grow a diversified real estate portfolio that will leave you thinking, “Why didn’t I do this sooner?!”
4. Start Thinking About Retirement with the Help of Your Employer
When finances are tight, having part of your paycheck taken out and put into a 401(k) may not seem like a realistic option. But the great thing about retirement accounts are that percentages of your salary, as little as 1%, can initially be the contribution you make. As times goes on and you receive salary raises over time within your company, your contribution can increase, as do tax deductions for contributing to a retirement account. Several companies will match the contributions of their employees, so over time you can increase your contribution to the minimum your employer is willing to match. Nothing is better than receiving free money to help you have a comfortable future.
5. Mutual Funds: Easy and Straightforward
Mutual funds are a collection of investments by several investors to buy shares in stocks or bonds. When initially researching mutual funds, first-time investors may become discouraged because companies require minimum investments anywhere between 500 dollars and 5,000 dollars. However, if you read the fine print or speak to a representative from the company, several will forgo an initial, higher amount investment and instead let investors make automatic, monthly investments anywhere from 50 dollars to 100 dollars.
Automatic, monthly investments are typically not taxable accounts, although it is always worthwhile to see if this is an option with accounts that are open to being taxed. Contacting an employee in the human resources department of your company will help clarify if the automatic investment is an option within your company, as this investment can come directly out of your wages similar to a 401(k).
6. Savings Bonds: Easy and Less-Risky
Savings bonds, commonly known as U.S. Treasury securities, come in three categories: bills, notes, and bonds. When you purchase one of these securities, you are allowing the United States government to borrow money from you for a specific period of time. An additional benefit of savings bonds, besides having your money in a safe place and earning interest, are Treasury Inflation Protected Securities, or TIPS. You will be earning back interest and also additional, adjustment amounts based on inflation.
Lastly, similar to mutual funds or the 401(k) you enroll in at work, the savings bonds you purchase from the United States Treasury can be financed through the payroll at your company.
With these very simple and straightforward steps, each backed with information and helpful services to make the most of your investment experience, you will be on your way to Wall Street in no time!