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How to invest with little money? : personalfinance

Hi everyone! I’m 20f and I want to start investing but I’m not sure where to start. I don’t have very much to invest right now but I assume there must be ways to start anyhow

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level 1

Learning to save is your best start. Try to be frugal in lifestyle

https://www.reddit.com/r/Frugal/

and save as much as you can. Compound interest is your friend at your age. Look into Exchange Traded Funds (ETFs) to minimize risk.

level 1

The more experienced will chime into your question, but I know they will ask if you have an emergency fund.

Do you?

No point in having a great investment if it can be wiped out by an unexpected situation.

And if you have any debt, pay those off too. Otherwise, I wish you the best of luck!

level 1

Check How to handle $ in the sidebar, and the 18 to 25 post. Come back with specific questions.

There’s also a specific read on investing, although I would personally consider it overly cautious to have a bond fund as a 20 year old with a long time horizon. Your risk tolerance plays a factor.

Don’t sell in a downturn. When the markets are doing badly, company ownership is on sale — buy instead.

level 1

Pretty sure you could invest in an etf with Robinhood .

level 1

Do not go to a financial adviser because they can talk you into bad investments that may not let you take out your money for years, unless you pay a withdrawal penalty. Even advisers at credit unions can’t necessarily be trusted, and many of them just rent office space from them.

Maybe you should keep your money in an FDIC-insured bank account until you learn what to do. Some Internet banks pay 1.5% annual interest and no fees, at least if you meed a minimum balance requirement.

level 1

I’ve been using acorns for 2 months as im in a simmilar position to you. Except im 27 and have 2 kids and im getting married in a year. Im investing 5 a week. I’m giving it a a 6 month trial but so far it seems to be working. Im thinking of it like savings with the possibility of earning money. Investing is a long term thing.

level 1

I would look into one of the robo apps like Betterment or Acorns. Yes, you do need an emergency fund, but there is no reason a robo investment could not serve the same purpose. Paying off debt while sacrificing savings does not help you maintain an emergency fund – it needs to be a balance.

Edit: Wow! Looking at the downvotes there is apparently a clear dislike or lack of understanding of how services like Betterment function!

level 2

Acorns is the bomb. We put $5/week and did change roundups and came out at like $1500 in one year.

level 1

Robinhood app. When you sign up they will give you a free share of stock.

level 2

Investing in individual stocks is a pretty risky proposition when you are first starting out.

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