Get the app


3 Easy Ways to Start Investing

April 26, 2022


3 Easy Ways to Start Investing

Essentially, by investing in your 401k, the company is giving you free money, which is also invested in your 401k. If a 401k is not available through your employer, go back to your bank and open an IRA, or Individual Retirement Account.

Some companies that are publicly traded on the stock market also offer stock purchases to their employees. These are typically fractional stock purchases, which means instead of purchasing one whole share of stock, you can purchase a portion of a share of stock. Eventually, you will own a whole share.

Investing your hard earned money can be a terrifying prospect. This is especially true if you know little to nothing about how investments work, how to pick stocks, or how to predict what the future holds. It gets even scarier and more confusing when you look at the various investments available, such as Certificates of Deposit (CDs), Exchange Traded Funds (EFTs), stocks, bonds, money market accounts, options, and more. Fortunately, you do not have to be a financial wizard to make sound investments. You don't even need a lot of money to get started. Here are three easy ways to start investing. 

Check with your bank - Most banks have many investment opportunities. Start with a savings account and an interest earning checking account. Too often, people don't view these accounts as actual investments, but that is exactly what they are. From there, check into buying CDs, or Certificates of Deposit, through your bank. See if you can buy and trade stocks through your bank. Some banks even offer free or low-cost investment advice.

Check with your employer - If a 401k retirement plan is offered through your employer, you should definitely take advantage of it. You can easily get this started by contacting the Human Resources department where you work. The amount of money you specify is taken out of your paycheck each payday and invested in your 401k. The company will match the amount, or contribute a certain percentage of what you invest.

As with a 401k, some companies will buy a fraction of stock for you each time you buy a fraction of the stock. This is easily set up through the HR department, and the funds for the purchase come out of each paycheck, usually in an amount set by you.

Use a robo-advisor - There are many robo-advisors available online. These are automated programs or apps that allow you to answer questions about your financial situation and your goals. These sites allow you to start investing with a small amount of funds, making it possible for most people who have any income at all to start investing in their futures. A robo-advisor is essentially an automated financial advisor.

An alternative to a robo-advisor is an online investment account. As with robo-advisors, there are countless investment account sites, also known as trading platforms, many of which will allow you to open an account for a small amount of money.

Before selecting either type of investment platform, read the fine print. What are the fees associated with the account, and with the trades you make? Is the platform approved by the Securities and Exchange Commission, or SEC? Many platforms will post a notice on their site that says they are SEC approved, but this should be confirmed via the SECs website.

Investing money is only as hard as you make it. Once you've started with simple investments, such as a savings account, retirement accounts, and reasonably safe stock purchases, you can decide how much further you want to venture into the world of financial investments, and take the time to learn about each investment before taking the plunge. You really can start making your money make more money for you today!