April is Financial Literacy Month and it’s an appropriate time for college students to focus on developing the skills and learning about the tools there are to help make smart money decisions throughout their lives. Investing often seems like a strange concept for many college students to grasp. “Why should I invest now?” “How do I even get started?” “How much money do I need to have in order to invest?” Those are just a few of the questions students ask themselves when presented with the idea of investing. My family has always stressed the importance of saving money and preparing for your future. I was able to take these teachings and evolve them into investing rather than just “saving”. Here are some of the realities of investing so that you can be financially prepared for your future. 

Invest now!

One of the best things you can do as a young adult is to take advantage of your age and invest NOW. The more you invest today, the more your investment will be worth in the future. For example, if a 20 year old invests $1,000 in a brokerage account that grows at an average rate of 10%, that money will be worth $72,890 when they are 65 and ready to retire. And that’s just one investment! Imagine if they keep putting money into that account. You don’t necessarily have to save money just for retirement. If you want to take a fun trip next year or want to have a college fund for your future children, investing your money is a quicker way to reach your financial goals than just stuffing cash under your mattress. Every day that you wait is an opportunity missed, so take advantage of your youth and invest now. 

How to get started

Many students are intimidated and assume that investing is too complicated and too hard. This is a total misconception. It’s actually fairly simple and easy to start investing because almost all students have smartphones and computers now. All you have to do is sign up with an investment bank, like Fidelity or TD Ameritrade. Robinhood is gaining popularity among young people because they offer free online trading and don’t charge a commission, making it even easier to invest on a budget. Once you sign up, your money does all the work for you.

How much money do you need to invest?

Another misconception about investing is that only wealthy people have enough money to buy stocks and bonds. However, the reality is that if you only have 30 dollars to spare, you can still invest it! Many brokerage accounts do not require a minimum investment amount, meaning that if you can only afford to buy one stock of a company, that’s ok! Just remember to keep investing as you make extra money so you can grow it at an even faster rate. 

By investing money now, you are preparing for your future. There are many resources available online and on most college campuses to help you get started. Start letting your money work for you by investing instead of just saving.