7 Easy Ways to Get Started with Investing

Investing requires commitment and consistency. Investors do not get the benefits of their investments in an instant. Sometimes it takes years to become a multimillionaire or a billionaire. Unless you were born with a silver spoon, you will have to start with the little you have. Even a few spare dollars can improve your financial standing with compound interest.

Your savings can last longer than your relationships. However, you might need to swap a couple of habits in order for your savings scheme to truly work. Replace your daily cappuccino with homemade coffee, buy cox gigablast, and you could be saving several bucks a month. You already have seen the wonders of automation. Why not use it to improve your investments?

Investing can do wonders for your financial health. That being said, here are seven ways to get started with investing:

Savings

As a child, you must have dropped in nickels inside the cookie jar your parents brought for you as a present. You must have waited impatiently to empty the coin holder. The good thing about jars is that they are still used to this day. After you have munched on all the cookies, you can use the jar as your personal savings holder. Even a $10 saving on a weekly basis can give you $500 after a full year. It is important that you develop the habit of saving.

The electronic equivalent of a traditional coin holder is the online savings account. As the name implies, a savings account is used to stash funds with the intention of accumulating more over a period of time. A checking account, on the other hand, is used for daily transactions and withdrawals. You can withdraw cash from your savings account within two business days but that won’t serve the purpose of long-time savings.

Stocks & Mutual Funds

If you have seen the critically acclaimed “Wolf of Wall Street” then you must be familiar with the workings of stockbrokers. Stocks are among the most common investments pursued worldwide. Thanks to the internet, you can start with very little upfront money. You can also acquire the necessary information prior to investing in stocks.

Consider investing in mutual funds if you want to diversify your investment portfolio. Mutual funds are highly popular in the United States due to their advanced portfolio management, convenience, among other benefits. Cons include high fees and mismanagement.

Bonds & Treasuries

Bonds are fixed-income instruments that represent a fixed loan amount issued by an investor to a borrower. Bond owners are typically referred to as debt holders or creditors. These financial instruments are used by governments and corporations to fund large-scale projects and operations.

Corporate bonds yield a higher interest rate as compared to government bonds. However, they are considered risky investments due to their stock-like nature.

Treasury securities, on the other hand, are government debt instruments that serve as an alternative to taxation. T-bills yield fixed interest rates following a maturity period ranging between six and 12 months. The duration of the maturity period determines the interest rate. You can either purchase bonds and securities directly from the Department of the Treasury or by investing in an exchange-traded fund (ETF).

Robo Advisors

The advent of Robo advisors a decade ago transformed the investments landscape. The biggest advantage of Robo advisors is that you can literally start off without any prior knowledge. Robo Advisors are designed to determine the risk tolerance of potential investors. All you need to do is answer a few simple questions. After several formalities, Robo advisors distribute your investments between various platforms such as stocks and ETFs.

Real Estate Crowdfunding

Real estate is arguably the most popular investment avenue in the world today. It is a lucrative investment with solid profit margins. And with real estate crowdfunding, you can invest in a property with just as much as $1000. Real estate crowdfunding allows individuals to become fractional owners of large commercial properties without the worries that come with being an individual landlord. Now, anyone can become an owner without prior experience in real estate dealings.

Employer’s Retirement Plan

Every working professional should consider this investment model. The contribution amount is so small, you won’t even notice the deductions. Select a good employer-sponsored retirement plan and start saving from your monthly income. You can gradually increase the amount of money you contribute to the retirement plan. The internet is flooded with investment management tools. Pick one for yourself and begin the journey today.

Precious Metals

The value of gold is seen to increase by over 300% over the last 30 years. Individuals in favor of metal investments see gold and other metals as precious commodities. Whatever the case may be, metals should be viewed as speculative investments. After all, you’re counting on public demand for gold so that you could get a higher price for your tangible asset.

In Brief…

The key to investing is that you complete your share of homework and take all options into consideration before selecting the avenue of your choice. With so many choices, it is always better to start with the ones that require little investment and are less risky.