18 year old with some cash laying around seeking tips
Currently 18 years old with around $6000 saved from working part-time and during summers. People always seem to say that you should avoid having your money in cash (which is the case for me), however, I'm not really sure how to go about this.
I've been picking stocks since I was 15. Nevertheless, I only invest in maybe 1-3 companies per year so I'm by no means 'actively' investing or how you you'd like to put it. I do quite enjoy my strategy and the process of researching and eventually investing in stocks. However, I neither have the time nor am I confident enough in my abilities to spontaneously invest all my capital in a handful of stocks.
It seems like a waste to have my money lying around in my bank account so I thought I'd ask WSO for some advice.
E.g Should I look into funds? And if so are there any ppl recommend?
Or
Should I just keep my money in my bank account for now?
I personally like the idea of having my cash invested in some sort of 'safe' asset where it exponentially grows by like 2-3% per year. I guess this is easier said than done though.
If you want to be super safe and are willing to take lower returns to offset it, maybe look into dividend investing, or some low volatility dividend etfs. Some of these can hand off annual yields of about that 2-3% you mentioned. Personally, I'm invested in ETFs that track major indices: VOO and VUG. Honestly, whatever your appetite may be, there's something out there for you, and 6000 at 18 is nothing to sniff at! Just go on youtube or do a google search of whatever ETFs (or individual stocks if you choose to continue on that route!) fit your goals.
Thank you for the tips! I haven't looked into dividend etfs before so I'll definitely check that out.
In regards to the ETFs you mentioned, do you reckon that it's a good time to buy into the VOO considering current market conditions?
If you have a long time horizon, I don't think there's really a bad time. Just make sure to dollar cost average your way in if you choose to do so. I'm down a lot in 2022 so far, but I'm buying all the way down, and will be buying all the way back up as well!
The most important investment you can make is in yourself.
Of course! However, while I try to figure out what that investment could be I feel like my money should be lying somewhere actually accumulating (hopefully) positive growth.
Whatever you do, avoid TQQQ like a plague unless you want a life lesson you don’t need
At 18 years old, a small to mediumish percentage of their portfolio in something like TQQQ I don't think should be "avoided like the plague". Depends on their situation, but I'd take advantage of that rent free, small responsibility life while I can. Just make sure you have a long timespan with that investment (2-5 years?). I just think the risk of "losing it all" at that age is not that large compared to the possibility of making a handsome return.
WSO, the financial advisor you can trust
Perspiciatis ad error expedita exercitationem veritatis. Et laudantium culpa accusamus natus nisi qui ut. Id et odit laboriosam quos excepturi et et.
Quia optio dicta laborum consequatur occaecati soluta. Beatae maiores exercitationem placeat ipsam a. Dolorem distinctio voluptatum ad. Quis possimus porro sed sit eos ullam. Qui rerum repudiandae earum quia natus.
See All Comments - 100% Free
WSO depends on everyone being able to pitch in when they know something. Unlock with your email and get bonus: 6 financial modeling lessons free ($199 value)
or Unlock with your social account...