Do you have a bit of extra money? Let’s say you have $100, or $1,000 or $100,000, what should you do with that money? It’s nice in the bank. Everyone likes watching their bank account grow! It’s also nice to have a pile of cash. You can see it, hold it, smell it, know it’s there if you need it. But the unfortunate truth is money in the bank or under your mattress is only losing value. Your $1,000 now will not have the same purchasing power that it will in 10 years. You need to do something with that money or else you’re going to lose it. Money sitting in the bank is losing its value by at least 5% per year. So now what? What do you do with that money you’ve worked so hard to earn and save? Invest! Get your money to work and let it increase in value!
But, before you begin investing, I want you to make sure you have a few things in order.
- Are you tracking your finances? Do you know how much you spend vs save each month? If not, start here.
- Do you have an emergency fund saved and easily available if you need it?
- Is your debt under control and manageable or eliminated?
If you didn’t answer “yes” to those three questions, then you need to evaluate your financial situation and get it in a better place before you consider investing. If you did answer “yes” to those three questions, then let’s start investing!
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What Should I Invest In?
There is a myriad of ways to invest and unfortunately I can’t recommend a one-size fits all approach to investing. Everyone has a different risk tolerance, different amount to invest, and are at a difference place in life and retirement. However, I can help you find resources, get ideas, and give you the motivation you need to get started! Let’s face it, your money can’t go to work for you if you don’t give it a job!
Here are some of your investment choices: real estate, stocks (including 401ks, bonds, mutual funds, anything tied to the market), gold, start a business, peer-to-peer lending, CDs, and more. My first piece of advice is to diversify! You’ve probably heard it before, but the old adage is true, don’t put all your eggs in one basket. If you have money in stocks, gold, real estate, and a 401k, then you’re pretty well covered. All of these markets will have their ups and downs, but they don’t historically all go down at the same time. So while you might start worrying if the stock market is dropping and your mutual fund is losing value, but you don’t need to panic because your rental income is steadily growing and you have gold that is holding its value. Diversity can bring you peace of mind and alleviate some of the risk involved with investing.
If you’re just getting started with investing, then you probably can’t jump in to all these baskets at once. So let’s start with the stock market. Stocks are an easy way to begin diversifying and get comfortable with the market. Exactly how you begin your stock journey is up to you. Do you want to trade your own stocks or pay someone else to do it for you? Do you want a whole financial plan mapped out or do you want to give trading a try and pick your own portfolio? If you’re hesitant to get started, don’t be! These resources I’m listing below want to help you be successful, improve your financial situation, and increase your wealth! Get started by taking a look at which category appeals most to you and let your investment journey begin!
Investor #1 – Hands-Off Approach
If you’re the type of investor who wants to let the professionals handle everything, then this list is for you. These companies will help you figure out how much to invest, put it in the appropriate investment vehicles, and then send you reports letting you know how your investment is doing. This is the simplest approach for those who are willing to step back and take advice.
1. Personal Capital – Get to know your money. Over 1.3 million people use Personal Capital to track over $312 billion. See your net worth, analyze your portfolio, plan for the future.
2. TD Ameritrade – Get the information you need to set and pursue your retirement goals. Browse their exclusive videos, try out their tools and trading platforms and listen to their webcasts to help you figure out a retirement strategy that makes sense for you.
3. Betterment – Betterment is the largest independent robo-advisor, helping people to better manage and grow their wealth. We make recommendations from how much money to invest to the type of account that’s right for you. Then, we invest and manage it for you in a way that many traditional investment services can’t.
4. Learn Vest – LearnVest Premium gives you a financial plan, a real person to talk to, and tools to make better financial decisions. A dedicated financial planner, available to you 24/7 via email. A fully-customized financial plan that helps balance your wants and needs.
5. Future Advisor – We guide all of your accounts to help you work toward reaching your goals sooner. Free investment advice for everyone. Our plans are customized to your financial situation and all of your accounts: cash, taxable and retirement.
Investor #2 – I Want Control
If you’re the type of investor that wants to be responsible for your own fate, then these companies are for you. They will provide you the platform to trade with, resources to help you make investing decisions, tips, strategies, and more, but you have to be the one to click the “buy” button! This is a great path if you want to day-trade, swing-trade, want to generate additional income with stocks, or if you are willing to stay on top of your portfolio yourself. These companies can also be a good resource for longer term investing and can be used for diversifying your portfolio, buying options, and more. Don’t be afraid of putting your money in your own hands. If you do your research, make controlled and thought out choices, and enjoy the thrill of buying and selling then this route is for you!
1. Trade King – Investing on your own terms. $4.95 stock trades, no minimums, powerful platform, award-winning tools.
2. Smarter Analyst -Leading financial news publisher. It provides hundreds of thousands of investors with the latest stock market news and valuable investment tips. SmarterAnalyst publishes some of the best-performing online investment newsletters for both swing traders and long term investors such as The DailyInsider and The BigShort.
3. Born to Sell -Earn extra income on stocks you own with our covered call screener and portfolio management software. Covered calls are an easy and conservative income-oriented investment strategy.Use our covered call screener to earn extra income from stocks and ETFs you already own, or to help find new investment opportunities selling the best covered calls.
4. Top Dog Trading – Learn how to trade with complete confidence.
5. Options House – It’s in our name for good reason. OptionsHouse features a “Best for Options Traders” platform that gives you access to robust options chains, powerful charting, and TradeLab, a supercharged analysis tool. Plus, you save money on our value-oriented commissions and lower per-contract fees.
6. eToro – Discover eToro, the world’s leading social trading network, where millions of clients earn by copying the trading actions of our best traders.
7. Sure Trader – Successful Day Trading is enabled by information and technology. You want to be able to trust the technology and pricing of your online broker to execute your trades promptly and consistently. SureTrader offers you the preferred software for day traders with its many advanced features that include quotes, charting, top stocks, trade logs, and many others at great prices.
8. The Street – Get An Investing Edge By Joining Jim Cramer’s Members-Only Investing Club. Become an Action Alerts PLUS member to learn from the pros how to invest wisely and build a customized portfolio of blue chip stocks. Online tools, classes, and articles to help you put the advice into action.
9. Robinhood -Free stock trading. Stop paying up to $10 for every trade.Robinhood is available now! Signing up takes less than 4 minutes.
10. Trade Station – TradeStation’s award-winning trading platform, trading software and online financial brokerage services set the standard for fundamental and technical analysis of financial markets, and for direct access online trading across multiple asset classes.
If you haven’t walked the path of the stock market before, don’t be afraid. Stocks are an excellent addition to any investment portfolio. Each of these companies have professionals willing and anxious to help you get started. If you’re nervous that you don’t know enough about stocks, options, trading, ETFs, or what these terms even mean, I recommend spending some time on Investopedia. They have excellent resources, tutorials, and even an Investopedia University. I spent a lot of time on their site before I started in the stock market and learned a lot! Now let’s get started by checking out a few of the investment companies I mentioned above. Talk to them, see what they can offer, and then chart your own path to financial success!