Find a trustworthy investing brokerage with a usable online interface.
Open tax-free investing accounts. Account Types: skip tax on the money in OR skip tax on the gains out. US has Traditional IRAs and Roth IRAs. Canada has RRSPs and TFSAs. Recommendation: skip tax on the gains out (Roth IRA / TFSA); these are the most flexible when you need the money for an emergency, a business, or a first home. No penalties on withdrawing money as long as your withdrawals do not exceed your deposits.
Open a margin investing account. Post-tax money in; taxable gains out. Setting up this account now will prepare you for when you wish to invest more money after having reached the contribution limit on your tax-free investing account.
Deposit money into your investing accounts. At least $1000 for various reasons (fee proportions, investing minimums).
Invest your money into something.
Mutual funds are supposed to have smart people invest your money smartly for you; however, most mutual funds do not beat the return on an index fund and many have high fees.
Index funds provide diversified risk by pooling money into buying a lot of major stocks for a much lower annual fee than mutual funds; however, index funds are dumb and will not protect you against broadly overvalued stocks, market downturns, and major industry upheavals.
Picking what to invest in by yourself incurs the lowest fees and directly tests your understanding of the economy; however, a hand-picked portfolio is usually prone to low-diversity risk and costly investing mistakes.
Submitted July 12, 2017 at 12:27AM by 101trajectory http://ift.tt/2uc4ZnU
