How to Get Started Investing as a College Grad
You have graduated from college and have begun to think about your future. Congratulations for accomplishing your educational goals as well as thinking wisely about your future. Although retirement may seem like light years away, the sooner you start getting your ducks in a row to save for retirement, the better. Investing is a fantastic way to start saving, so here are a few ways you can get started as a college grad.
You do not have to wait until you have a huge chunk of money saved away. Get started with micro investing or ETFs. Micro investing can be achieved through apps such as Acorns or Stash. You just need $5 to open an account (although Stash charges $1 for accounts that have balances below $5,000 or $2 for IRAs up to the same amount). Acorn also issues a $1 fee for balances up to $5,000, while balances beyond that amount are charged a percentage. Acorn is free for four years, which is great for college students. You just need to share your .edu email address with them.
Exchange‐traded funds (or ETFs) are another investment option.
ETFs are a security option that tracks a basket of assets, commodity, bonds or index. You will be investing in a number of stocks. ETFs also have a lower expense ratio, which is great if your cash flow is short.
Cut Back Where You Can
Investing may seem impossible when you are a nearly-broke college student. How will you ever find that extra money to invest with? It may not be as difficult as you think it could be. Track your spending to figure out where all of your money is spent, then decide where you can cut back so you can afford to invest some money.
Look For Employer-Sponsored Retirement Plans
Many employers offer employer-sponsored retirement plans, such as 401(k) and 403(b) plans. Get started with investing in this way. All you have to do is enroll and decide which percentage of your salary you will contribute. Take advantage of matching employer contributions as well, otherwise you will be leaving behind money that is available to you!
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