There’s no way around it — college is expensive. Have you considered trading stocks to pay for it, or to help pay off those pesky student loans? This article will help you navigate the stock market even if you don’t know a bull from a bear.
I Want to Invest, But Don’t Know How!
First ask yourself how involved you want to be in investing. If you want someone else to do the work, you’ll want a robo-advisor. A robo-advisor is an online financial advisor that bases its advice on mathematical algorithms. Virtually all major brokerage firms offer this service for a fee.
If you want to be a more “hands-on” investor, you’ll want to open an investing account. This can be done through a brokerage firm, or if you’re particularly daring, through a free app called Robinhood. Good firms for beginners are TD Ameritrade, Merrill Edge (no account minimum), and E-Trade.
If you want a hybrid of the two, you might be interested in apps that invest in exchange-traded funds, or ETFs. ETFs are a group of securities that aim to match the market and trade like a stock. ETFs are typically cheap, and a good way to enter the market.
Regardless of which path you choose, you should do your homework — that is, learn everything you can about investing. Some good books include A Random Walk Down Wall Street by Burton Makiel and The Intelligent Investor by Benjamin Graham.
What Should I Invest In?
Whatever you know the most about. For example, if you are an expert in medical marijuana, you might be able to choose the best marijuana stocks. Keep up to date on trends, and judge trends based on their staying power. Some safe investment areas include the food industry (people will always need to eat) and the entertainment industry (people will always get bored).
What Are Some Good ETFs?
Some good examples of apps that trade ETFs are Stash and Acorns.
Stash gives you a $5 sign-up bonus. After a short personality test, the app recommends an investment profile, such as conservative or aggressive. As a general rule, the younger you are, the more aggressive you should be. Stash also allows you to invest extra money in themed ETFs, such as women-owned businesses or dividend stocks. There is a $1 per month maintenance fee, and you get $5 for referring your friends.
Acorns is linked to your spending so, when you make a purchase with a linked debit or credit card, it rounds up the money paid to the next dollar. When you reach $5, it invests the money. The good news is you barely notice the difference. The bad news is if money’s tight, this can easily cause an overdraft! Nobel Prize in Economics laureate Dr. Harry Markowitzs helped design this app, which allows you to build a portfolio with the kind of speed that makes Usain Bolt squirm with envy. You get a $5 registration bonus.
Basically the TL;DR (summarized) version of most recent books on stocks is “buy index funds and plenty of them.” ETFs are a cross between index funds and stocks and work best with a “buy and hold” strategy. Which ETF to invest in is ultimately up to you, but most experts recommend that you “buy what you know.”
