You Should Invest Your Money, Even If You’re Afraid To
Automate all your money woes in 2020
Investing sounds creepy to me. Maybe because when I read or hear that word I think about how some banks invest in pipelines or crude oil or other things that are essentially destroying our planet. It also reminds me of The Wolf of Wall Street where bros drink, eat and be merry at the expense of everyone else. Or I hear about how people “invest in real estate” in working class neighborhoods like the one I grew up in at the expense of longtime residents who couldn’t afford to buy homes or weren’t given the loans to do so thanks to racist practices like redlining.
The actual definition of investing, at least financially is “extend money” or other assets with the expectation that it’ll gain you interest. So as crappy as it is for institutions and people to invest in things that hurt regular people… if it makes them money… they’re going to do it.
And as someone who didn’t really grow up with a lot of money, I understand that I have to create different streams of income to make the most out of my income. Saving my dollar bills in an envelope under my mattress (like I used to do) isn’t going to grow my money. So I’ve decided to start looking at investing as something that could do to invest in myself in the future,
Investing means that money will grow alongside rising prices.
That being said, it will not always outpace the cost of things like the cost of an education or housing in big cities (which is insane). But investing and having that money grow over time could be the difference between making it through a medical emergency or being able to pay bills when you’re older and living on a fixed income.
- Sometimes investing is a CD account. Though some CD accounts are rigid and have penalties for taking the money out early, there are some great accounts that can be used to grow money over a few months, a year, or several years. Some accounts have penalties for taking money out early, but thanks to the different time frames for different CD accounts, there are more and more options for putting money away. Different banks have different penalties for taking money out early, so don’t be afraid to lock up a few hundred dollars for the future.
- Sometimes investing is an automated app. The idea of investing in stocks is scary and gives me flashbacks of 2008, when I was a young teen who then saw the freaking economy collapse and screw over so many people. But there are ways to make sure it’s not so risky for yourself, you can try opening an account with a site like Wealthsimple where as little as $5 can be invested every month. The site allows users to have different variations of risk and to put their money in either stocks, or bonds, or both.
- Sometimes investing is opening a new savings account. That is if that savings account comes with a high APY, which means a higher interest rate of returns on your money. There are several online banks that have a higher than 1.5% interest rate on savings, which means there will be a noticeable change month to month in the increase every month. When I first opened a higher yield savings account, the deposit barely made a few cents in interest that first month, but over a year later, my bank account was making me several dollars a month. That number is only going to go up over time. It’s worth the hassle of opening another account.
- Sometimes investing is a 401k. If a job offers a 401k match, which means free money from an employer. Not taking advantage of it means you’re missing out on free money. It may means lightly lower take home pay, but it’s an investment towards a more comfortable future for yourself. I know that when I receive a 401k I will definitely be putting money away.
The best way to start investing is to see what your goals are, how much you can invest, and then get started. Maybe you don’t have access to one of the ideas listed above, but you do for another. At the end of the day, an investment in yourself and your financial future is only going to benefit you.
Need more freelancing/trying to make it in media advice? Sign up for my newsletter. It’s called Media Mercado.
Be prepared for a lot of gifs. And a lot of links to free resources.