By Derick Gant
The Truth Contributor
Investing can look very intimidating when you haven’t ever invested money. All types of investments are not risky and there are some great investment options that you can start with as little as $100.
To be a savvy investor when you are starting, here are some easy ways to invest money for beginners.
1.Treasury Securities
Treasury bonds, treasury notes, and treasury bills have maturities as short as 30 days to as long as 30 years. The T-bills, T-notes, and T-bonds are backed by the U.S government which means they are super safe and the return is guaranteed. They are a great place to start growing your cash slowly with no risk. Every T-bill has a face value of $1000 but they can also be bought at $900 (or less or more) depending on the market price of the T-bill. Among easy investing for beginners, treasury securities are the easiest as you can purchase T-bills with as little as $100, which is the lowest minimum investment requirement for T-bills.
2.Savings Account
Putting money in a saving account is the easiest type of investment that is also risk-free. You can choose a bank that offers the best interest rate and you can start depositing your savings into the savings account. Many savings account offer low-interest rate with very few offering inflation-beating interest rates. As a beginner, your goal must be to stay as risk-free as possible, so select a savings account that secures your funds and offers a good interest rate. The compounding may not be able to beat the inflation but as your first investment, it will be a great low-risk investment that is better than cash sitting idle in your bank account.
3.Retirement Plan
Investing in an IRA or Roth IRA is also a great investment that suits many beginners because people with all levels of income can start an IRA. Depending on when you want to retire and how much money you’d like to spend each month after retirement, you can purchase IRA or Roth IRA today. With an IRA also known as traditional, your contributions grow tax-deferred until you start withdrawing funds at your retirement. On the other hand, Roth IRA deducts tax on your contributions so that you can enjoy tax-free withdrawals later.
Saving and investing money for retirement are wise decisions that you should make as soon as possible to take advantage of longer compounding periods and higher returns upon retirement. If you have a plan to spend your retirement days chilling in spas while sipping on margaritas in the Bahamas, then start investing as soon as possible.
- Employer Contribution Plan
Among many other incentives offered by employers, an employer contribution plan is a great incentive. Find out if your company offers a contribution retirement plan.
A 401k or employer-contribution plan is a retirement plan where your employer also contributes a sum of money every month towards your retirement fund. Let’s say you want to pay $500 each month, if your employer pays 50% premiums, the employer will be paying $250 each month!
Whatever sum or percentage on an employer contribution plan your employer is willing to pay each month is free money and you should never leave it on the table.
- Invest in Corporate Bonds and Stocks
To invest money in stocks and bonds, you don’t have to be extremely rich or knowledgeable. Investors have made thousands of dollars overnight from stocks because it is one of the best ways to grow wealth both quickly and slowly. To step up your investing game, learn about the best investment options in stocks. These days there are numerous apps in the market that make investing in stocks easier than ever.
Diversify the risk by investing in mutual funds. Even the most successful stock investors had to invest money in stocks for the first time. Think of it as a chance to learn more about the stock market and grow your hard-earned dollars.
- Start a Side Hustle
Investing does not always mean investing money in stocks or real estate. You can also invest money in yourself to learn a skill that generates income. If you have $100 or more, enroll yourself in a class to learn an in-demand skill for freelancing such as photography, graphic designing, web development, video editing, or photoshop. Freelancing is flexible and it adds additional cash to your pocket whenever you are up for it.
- Set up an Online Store
If you have a small amount of money in savings, use it to set up your online store. Get a web developer to design your website and start selling something online. You don’t need to buy expensive inventory either, collaborate with a local store and sell their products online to earn a percentage for yourself.
Customized, unique, and rare products are in high demand. If a store sells customized clothing items, partner with them. Or set up a store where your clients pay you online in advance to gift wrap perfumes and send them to your clients’ loved ones living away from them. Services or products that are unique sell like hotcakes.
Bottom Line
Many millennials are choosing F. I.R.E; which means they gain financial independence to retire early. They choose to enjoy life after 40 or 45 rather than working at a 9-5 job until they are 65.
Investment is crucial if you want to build wealth with passive income streams over the years, with little to no effort.
Derick Gant is an American author, speaker, financial advisor, and money coach with over 25 years of entrepreneurial experience. In 2019, Derick published The 24K Life Code: The Only Difference Between Mediocrity and Greatness. This book guides people step-by-step to achieve their best and get the results they so desperately desire.