The best way to grow your money is to simply make conscientious use of your time, so investing while in college is actually possible. The earlier you start investing, the more your money can grow. Investing is a brilliant step to save for the future as long as you are dedicated, patient and disciplined.
College can be one of the most difficult times to get serious on the money-generating side when all you want is just do the things you want to do but it is actually one of the best opportunities to get started in the world of investing. It can be hard to go against the grain in a culture that's engrossed on getting instant gratification, especially when your friends may be immersed in the latest trends in fashion or technology. But resisting the temptation to follow the mediocre stuff can indefinitely reward you in the long run. Even those with only little amount can begin to build a portfolio, and it can actually be an advantage because you’ll be learning how to invest and grow your portfolio as time goes by.
Investing does not require a big upfront investment, and it doesn't require a lot of time or effort. All it requires is a small tolerance for risk, dedicated strategy, and time and commitment to learn more about creating investments. In starting young, you have an incredible advantage because there's still a lot of years ahead of you.
Saving to Invest
The earlier you start saving and investing, the more time you will have to build income streams. With retirement easily lasting thirty plus years, socking away as much as possible as soon as possible is imperative. The same goes for investing. Investing earlier makes more room for compounding in which the interest grows along with the principal each year. The investor can accumulate wealth through stocks, bonds, exchange-traded funds, and mutual funds.
Saving even a small amount of your allowance is better than nothing at all. If you are still in school, education should be the main priority, but being able to save and invest is a bonus and one that will pay big dividends after you graduate. With time on your side, you have a huge room to grow, learn and improve.
Saving and investing are two of the best long term habits that you can develop early on. Don't wait to invest if your excuse is that you don't have that much money because even $10 to $50 per month can go a long way if you are really committed. Stick to the plan and develop a lifelong passive income generating strategy. Once you get into the habit of saving regularly, it will become a normal routine. And when your income increases, adding to your savings will be relatively easy.
Starting a Stock Portfolio
As a college student, stocks are a perfect place for you to start investing. They can be volatile, yes, but they can be promising too with high returns in the future. Just think long term and be patient. Starting young is an advantage because you can simply let your money work for you and you're nowhere near the retirement age yet.
If you’ve never invested in the stock market before, it can be overwhelming at first. There are some terminologies that you still need more researching and learning, but that's alright. You're on the right track. You learn as you go.
Where To Open An Account
To help you get started, here is a list of investing websites that I recommend you use when starting your stock portfolio:
M1 Finance is the perfect choice for those who are looking to invest long-term, or those who are into buy-and-hold investing. The app was one of the first no-fee investing sites and it also has useful and user-friendly features for the type of investor who wants to put their money to work but doesn’t want to get into stock trading.
Another one is Webull. I like using Webull for stock market trading,for me it's just the better app for traders because it has some amazing features like advanced charting, IPO center, earnings center and extended hours trading that allows you to invest before the market opens.
The next one is Acorns. It connects with your debit or credit card and rounds up your purchases to the nearest dollar. This makes it a great savings tool and it makes the whole process automatic. If you're having a difficult time saving money to invest, you'll never go wrong with choosing Acorn.
With these choices, there are still a lot more investing apps that I personally use and recommend. But I highly encourage you to consider doing your research first before making up your mind. You can start investing in just one of those websites and then gradually use more of those as your income grows and stabilizes.
As a college student, nothing is impossible. You are in the perfect shape to get a head start on wealth building. Take advantage of compounding and time and let your money work for you overtime.
About the Author
Joseph Hogue is a financial expert and investment analyst. After serving in the Marine Corps, he started his career investing in real estate before becoming an investment analyst for some of the largest private investors. He's appeared on Bloomberg and on CNBC as an investment expert and has published ten books in personal finance. Now he helps investors reach their financial goals and invest in the stock market with some of the same advice he used when working for the rich.