Investments for Beginners: The Best Ways to Get Started

investments for beginners

Americans don’t have the best reputation for being financially savvy or literate. To their credit, banks and other financial institutions don’t make it easy.

One of the first and most important steps people can take in preparing for the future is to invest.

If you are ready to start making your money work for you, but are nervous to get started, don’t worry. Read below for five great investments for beginners tips!

1. Make Use of Employer Plans

It may seem obvious, but numerous people fail to utilize the easy investment options available through their employer. Even if your budget feels strapped each month, enrolling in a 401k or similar plan can add up over the years.

If you don’t have access to an employer-sponsored account, a good baby step is to dedicate 1% of your salary to a personal savings account. With each additional year and pay increase, try to increase this amount by 1%.

2. Hands in the Cookie Jar

Sometimes it can be hard to get started if you feel like you don’t have any extra money to start an investment account. It may seem out of reach to save up money, but it can actually happen fairly quickly.

Think about this. If you can spare $50 each month, over the course of a year, that will be $600. That is a healthy amount to open a wide variety of accounts.

If you find that you are struggling to get started, check out our guide on getting motivated for life goals.

3. Stocks as Investments for Beginners

Stocks are good for beginners and the most traditional option for investing. While a popular choice, there are clear risks.

To limit the impact of wild stock market fluctuations, it is wise to diversify. This means you should have some money in stocks, mutual funds, and other equities.

Be sure to investigate any firms or accounts properly. Look for low or even zero fees related to account management.

4. Use a Robo-advisor

Feeling skittish about choosing stocks or portfolios? If so, you may want to consider a robo-advisor. A roboadvisor basically is an investment firm that will automatically move your money between stocks and bonds.

Instead of a person making the decisions, a computer algorithm will decide how best to use your money.

5. Real Estate

Real estate is another great way for you to test the waters of investing. Some people think you need a lot of money to go this route, but this is not always the case.

This is an investment opportunity that has multiple benefits. While you don’t rent out the property, you and your family can use it for a mini vacation.

There are many resources to assist when real estate investing and property management. For example, the fundrise review provides valuable overviews and descriptions of everything you need to know.

Be Confident in Your Investments

You should be feeling pretty confident about investing after checking out this guide. No matter what your longterm goals are, these simple steps can help you begin your journey to financial security.

Do you have any additional tips for investments for beginners? Let us know in the comments!

Be sure to also check out our list of top motivational and inspirational podcasts to speed up your goal accomplishment!