It can be intimidating to start investing on your own. Luckily, big things have humble beginnings, and you don’t need hundreds of thousands of dollars to start investing. In fact, 2019 is the best time to invest your cash to grow your wealth.
This guide is to help you understand investing on a fundamental level so you can hit the ground running. You don’t need a fancy degree, years of experience or any expensive advisers to make your money work for you. Below, you’ll find everything you need to invest your money on your own in 2019.
Investment for Beginners
Without further ado, let’s break down the basics of investing. Investing is when you buy a portion of a company or a product/service with the understanding that that company or product/service will grow over time, earning you money.
Remember that investing is not a get-rich-quick scheme. Investing is a long game. It’s an effective way to consistently grow the wealth you already have over time. Because of compounding interest, you’ll gain money on anything you’re actively investing assuming that you’ve invested in a company or product/service that’s increasing in value over time.
Where to Invest in 2019
Now that you have the fundamentals of investing down (yes, it really is that simple), let’s talk about where you should invest in 2019. The best place to start is to review this 2019 investment guide by My Wealth Solutions which has the most up-to-date information. Aside from that, you’ll want to consider all of your options.
1. Retirement Investments
One type of investment that’s often overlooked is simply retirement investing. Namely, we’re talking about 401(k). How much money you can earn will depend on their matching percentage, but many companies match half or even all of your contributions.
If you’re investing 3% – 6% of your salary, this can easily grow your funds rapidly. This is one of the safest investments you can count on in 2019.
2. The Stock Market
Of course, we also need to list the most well-known place for investors to put their money. When you buy a stock from the Stock Market, you own a small portion of the company you bought into. If the company profits, so do your investment. When the value of that company grows over time, so do your profits.
However, a lot of newbie investors find this process confusing. If you’re not familiar with a variety of companies and they’re long-term outlook, you might want to consider a robo-advisor that helps you figure this out virtually. While it might sound like a plot from a sci-fi film, robo-advisors like Wealthfront or Betterment will invest your funds into the stock market for you.
3. Investment Bonds
Finally, an investment bond is a safe way to keep your money safe in the long-term. Though there’s less room for a high return like with stocks, it’s considered less ”risky”, so it’s ideal for new investors.
When you purchase a bond, you’re loaning money to the government or a company. The government or the company will then pay you interest on your ”loan” over the bond’s lifetime.
Protect Your Money in 2019
Protecting your money in 2019 can feel complicated, but it doesn’t have to be. The more you understand about investments, the better equipped you’ll be to make your money work for you. While there’s nothing wrong with letting your money sit in a savings account, you could be earning significantly higher returns with some know-how.
As the financial landscape continues to evolve, using your financial literacy to make smarter choices becomes more essential. What are your money goals for this year and beyond?