SAVING & Investing
Getting ready to invest
Investing is when your money makes more money for you. Savings accounts are safe; investments have risk. You can lose your money. They can take many years to pay off. Investing is good for goals that are 5 to 10 or more years away, like a child’s college education or retirement.
When are you ready to invest?
- you have at least 3-6 months of living expenses set aside
- you have no or low balances on your credit card, or have cards with very low interest (otherwise, the best investment you can make is to get rid of that debt!)
- you are already making contributions to your company’s 401(k) plan if they have one (this lets your money grow tax-free)
- you have someone you trust to help you get started on choosing what types of investments are right for you
- you have time to watch how your investments are doing
Click here (no link provided) to visit a website that describes the basic types of investments: stocks, mutual funds and bonds.
If you have a mortgage, another good investment is to make an extra payment each month you can. The extra payment directly reduces the amount of interest you pay.
Back to Saving Money