How to Start Investing

You may already have one. A savings account should pay 2 – 4% on the money that you have in the account. These funds have higher interest payouts than typical savings accounts, but they work much the same way. Certificates of Deposits can be purchased at your bank, and your bank will insure them against loss. When the Certificates of Deposit reaches maturity, you receive your original investment, plus the interest that the CD has earned.

You can select the duration of your investment, and interest is paid regularly until the CD reaches maturity. Next, invest in money market funds. This can often be done through your bank. The interest rates on CD’s are typically higher than those of savings accounts or Money Market Funds. This will give you a way to making your money grow while you learn more about investing. These are short term investments, so your money won’t be tied up for a long period of time – but again, it is money making money.

Start by being a conservative investor with a low risk tolerance. If you are just starting out, one or all of these three types of investments is the best starting point. A savings account can be opened at the same bank that you do your checking at – or at any other bank. Start with an interest bearing savings account. If you are anxious to get your investments started, you can get started right away without having a lot of knowledge about the stock market.

Certificates of Deposit are also sound investments with no risk. It’s not a lot of money – unless you have a million dollars in that account – but it is a start, and it is money making money. Again, this will allow your money to start making money for you while you learn more about investing in other places If you don’t, you should.

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