My son is in college, and for me, he’s become one of the best investors in his age and time. He’s been learning continually and is now unafraid to commit mistakes. He has learned while still in college that aside from building an education, it is also a great time to build his wealth. He didn’t need a large amount of money to start investing. He just learned how to do it.
This article centers on online investing, as this is the first and most successful option that my son chose. If you are a student who wants to learn how to invest while you’re still in college, do read on.
Initial Investment – Stocks
You will learn soon enough that you will most likely invest in stocks when you start your investing journey. This is because stocks are relatable and are also commonly discussed in public and online. You can talk about stocks while having coffee with friends or older family members, and you’ll get a lot of insight into what the best options might be. But if you ask me, it would be great if you have a short but clear education on how to invest.
Creating An Online Portfolio
Financial specialists agree that investing at a young age has a relative advantage over the others because as they start young, they will have a lot of time taking care of and handling their money. And if we talk about compound interest, then indeed it is true that time certainly is money.
Starting small is the wisest initial move for the college student who is looking to increase his funds. It is perfectly okay, as the important thing is the way you invest that will determine the future of your investment.
Here are simple tips to start your investing career right.
- If you plan to invest a small amount, say, $50, find a broker who is willing to transact with small accounts. Later you can always increase your capital by adding funds regularly.
- If you are a risk-taker, you’ll probably be more willing to earn big instead of thinking about the possible losses you might incur. But before deciding to invest a little more to earn more, do make appropriate calculations. College life means money for educational expenses too, and you can’t afford to lose more of what you can spare.
- Consider savings options that assure profits at minimal risks. Federal savings, savings bonds, and certificate of deposits are some ways to achieve this – in the form of savings accounts. Although you get the lowest profits, these are surefire ways to protect yourself from losses.
- If you can afford to invest your money at a longer period, try investing in exchange-traded funds or mutual funds. These funds consist of different securities like stocks, commodities, and bonds. Insurance or mutual fund companies are responsible for collecting and managing money from investors. More and more college investors are going for these options.
- Finally, before risking your extra college funds or your hard-earned money, remember to always look into the companies that you are thinking of putting your money into. If you’re interested in mutual funds, do a background check on the corporation that will handle your money. Some of these companies cater to banking or pharmaceuticals specifically, while others accept different portfolios.
As a student starting and making your way into the world of investing, you will eventually learn how the market works, and soon you will be investing in bonds and stocks. And who knows, at 30-something you’ll be living your dream! So start young and be financially successful before you even hit midlife.