But first:
You need to determine how much risk you are willing to take
You need to establish some goals
You need to determine your time horizon ("Forever", or 60 years is good)
Here's one good way to invest:
Let a mutual fund manage your money. Choose a company like Vanguard or T Rowe Price (There are many such companies) that have a "family" of mutual funds, Each fund specializes in investing in certain types of stocks, with certain levels of risks
1) High quality NO-Load Stock mutual funds are best. They are safer. This means you need to aim for hitting singles and doubles, not home runs. (You'll strike out too often). Making money is a long, slow process. It requires patience and discipline
2) No-Load funds offer instant diversification, and you get the benefit of the managers' expertise. They're more knowledgeable than you and I. Let them be "your brains". "No-Load" means you pay no sales commissions. All of your money goes to work for you. Whatever you do, avoid penny stocks.
3) Throughout your life, try to save as much as you can. (I think you know this.) That way, you'll have more to invest sooner rather than later.
4) Invest a certain amount each month. This gives you the benefit of "Dollar Cost Averaging"
5) If the value of your investments goes down, do not worry. It'll come back up.
6) Most people don't know when to sell. I know I don't. So I just hold on to them.That way, you don't pay any capital gains tax. And you don't have to worry about what to buy next. Hey! They were good investments in the first place.
7) If you can afford it, re-invest any dividends that the fund pays. That way, you get the benefit of compounding.
8) Go online to no-load mutual funds and take it from there Call come of them and ask questions.
9) I guarantee these funds will be worth more in 10-20 years or more than they're worth now
The biggest financial investment in your life is purchasing your first home. It requires a lot of money, but you're still young. You still have more or less a decade to save. But at least you're starting to look at things in a grand scheme. I think if you are into business, you could invest your money on that one temporarily. Don't shell out a huge amount. Just spend a measly amount of money just so you could try out a venture. Also, don't purchase a car or get married unless you have a house of your own. If you've saved enough in the future, you can ask for the help of bailey-estates.com in making you dream home a reality. They are considered as one of the best in services concerning custom home building.
I think you are already on the right path. You haven't listed anything that counts as a mistake. You started working before 18, save some of your money, and don't buy stuff you don't need.
However, since you have the initiative to grow and learn, I will give you an answer that I hope will bear fruit.
You mention that you want some options. The options that I want to give you are called "debit spreads", and they are a type of stock option. I would classify "debit spreads" as a more advanced form of stock trading, which you are NOT yet ready for, but which you could learn about and use, should you be so inclined, after an adequate period of study and practice.
The reason I am being so specific, is that your situation already shows you have some of the necessary interest and discipline to learn how to use options, instead of just jumping right in and losing your money.
What I would consider to be a responsible answer is to suggest that you continue to save money for the next 2 years, or another $4,000 at least while you learn about options, and make practice trades. Losing money is only good, in the sense that it helps us to remember our mistakes. But avoiding losing money is much better.
The 2 factors that determine how much money you can make in a year, are the amount of capital you have, and the percentage of gain, (or loss). At low levels of capital or skill, the numbers won't work. Currently you have low levels of capital and skill, so you should really refrain from investing or trading until you have some more money and a year or two of stock related book learning. I think Maverick Trading is a good book. You can read it and decide for yourself.
I personally don't like mutual funds because no one will ever make much money by investing in mutual funds. And if you don't want to make much money, why bother putting it at risk in the stock market at all?
If you want to make your money grow a great way is by investing in stocks. The only thing is it's not advisable for someone who really does not know anything about stocks. Before getting into this study stocks first and get advise from people who play the stocks.
Another alternative is by investing in "pooled funds". Example of pooled funds are 'Unit Investment Trust Fund', 'Mutual Funds', and 'Variable Unit Linked Plans'. Mutual Funds and Variable Unit Linked Plans are both offered by Insurance companies.
How does pooled funds work? Investments by all investors are pooled together and they are invested in Stocks, Bonds, and Money Market instruments. An expert called a Fund Manager monitors the stocks, bonds, and money market instruments and allocates the pooled investments in any or all the three investment assets making sure that the pooled investments earn the most.
In your case I would suggest any of the three pooled funds. It's a way for you to start in investment in a lesser risk investment vehicle.
And lastly, yes it is best to invest at a young age. The interest that your money would earn will continue to earn interest for as long as you leave your money in investment. Meaning, the money you've investment plus interest earned will earn interest year after year making your money your grow.
Invest in some financial education not just traditional education which won't teach you anything about finances. It'll be the best money you spend, just don't spend the whole $6k or you won't have anything to invest with!
If you have knowledge in forex trading, invest in it else save for your higher studies.
invest in your education.
Hello everyone I am really new to this kind of stuff so I was hoping you guys can lead me to the right path. I just turned 19 years old and I always hear from professionals that it is a great idea to invest at a young age. I have been working since I was 16 and now I go to school, so for the past 3 years I have saved about $6,000 in my saving account. I hate spending money so I never buy anything I don't need. So my question is what can I do with this what should I invest in. I am hoping someone can give me some options.
