This blog post was written by SAC Student, Meadow Hall.
Many resources are available to help you when you decide to invest, but navigating through them can be overwhelming. In order to ease the confusion surrounding investing, we have compiled some of the first steps you should take when beginning to invest and what information you need to know before getting started.
Why Invest?
Investing can be a great option to help you save for retirement, build wealth, and meet your financial goals. When you invest your money, it can help you avoid losing money due to inflation. Investing can also help you save money on your taxes by choosing investments with built-in tax efficiencies. Investing can also help you establish and grow your emergency fund; some investment options for expanding your emergency fund include high-yield savings accounts and money market accounts. To learn more about emergency funds, read our blog post here.
Where to Invest
When starting your investing journey, you need to decide if you prefer to control your investments or if you wish someone else to manage them. Several types of people can help manage your investments, like brokers, financial planners, and investment advisors. There are also many investment types, for example, stocks, bonds, and mutual funds. For information on low-risk investments, see our blog post here.
Risk
You also need to consider how much risk you are willing to take on. One way to do this is by establishing a budget for your investments. How much money are you planning to invest, and what percentage are you comfortable losing should the investments go wrong?
It is critical to establish why you want to invest, how involved you want to be in the management of your investments, and how much risk you would like to incur while investing. Overall there are many things to consider when investing, and we hope this information makes the beginning of your investment journey easier.
Check out HUECU's Investment Services at huecu.org/invest!