It’s Never Too Early To Invest

If you’re like me, you have always thought that it is way too early to think about investing your money. You might even think the whole process is way too difficult so why even bother. At this point, we’re totally focused on getting decent grades to graduate and passing that chem midterm. I’m also pretty focused on House Of Cards being released next week and how I’ll find time to binge watch it, but I digress. I always thought that investing was for old people to think about. I figured that someday I’d just magically understand how it works.

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Well, I was pretty wrong. From some basic research, knowledge I’ve gained through classes and information from the Money Smart workshops, I’ve got a general idea of how it works. But still, I had no idea how to get started. Last year I got a genius idea that I wanted to buy one share of stock in something to see how it works. It was so incredibly difficult to figure out how to buy just one share of stock that it was discouraging. Everything was geared towards having $1,000 or more to invest. Excuse me, but I do not just have $1,000 sitting around collecting dust. If I have $1,000 I’m paying off bills or getting ahead on bills so that I can buy more than bread and peanut butter for the next week. All I wanted was one share of stock, in something cheap, with a goal to spend around $20. I finally figured it out using Sharebuilder through Capital One 360 but it took some doing. Their customer service reps were actually incredibly helpful in walking me through setting it up and no one laughed at me when I said I only wanted to put in $20. My stock has actually lost money the entire time but that is why I wanted to start small. I just wanted to see how it worked.

That whole experience got me thinking bigger. What if I wanted to start something long term, even on my very limited budget? What if I wanted to open a retirement account, as a college student? I wanted to put in an amount of money that I wouldn’t miss too much and have the whole thing be easy. Upon talking to family members, and through some impressive Google-Fu, I decided I was going to talk to a financial adviser. Based on recommendations from said family members, I went with Edward Jones. I reached out to a recommended, local, financial advisor and set up a phone call. It ended up being easier than I thought.

The person I spoke with was incredibly helpful. He spent about an hour on the phone with me discussing my goals, how much I could contribute, my risk level and the different options we could look at. He explained how it works and even shared some information with me on how his clients generally do, in terms of making money, year over year. I ended up opening a Roth IRA which is a long term investment account. We set it up so that I automatically transfer over $50 a month and my advisor gave me the exact mutual funds that we are investing it in. I had to wait until I had a couple of deposits in my IRA account before he could actually invest the cash, because there is an annual fee to have the account and the price per share is high, but that was it. He communicated with me throughout the whole process and I always felt secure. Anytime I have a question, even if I think it is dumb, he talks with me personally and makes sure I fully understand the answer.

I’m a little neurotic. I like to know every little piece of things. The fact that Edward Jones has a website that I can login to and see how my account is doing at any given time puts me at ease. I even can see the stock symbol and have since added it to the app on my iPhone to track it there too. I’m not making Khardashian money by any means but by starting now, my funds are going to grow at a much faster rate than if I started 10 years from now. Plus, if I ever need to change the amount I’m investing each month, whether it be a higher or lower amount, that is totally OK and there is no penalty.

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No, Edward Jones didn’t pay me to do this. I’m sure someone out there is thinking that. There are actually a lot of places that do this kind of thing. Charles Schwab, Fidelity Investments, Raymond James and UBS Financial Services are all top advisors who do this. Any one of them would be a good start and it all begins with a phone call. Here are a few things to think about:

  1. How do they respond to questions so that you feel comfortable? Can you call up or email? What is the turnaround time?
  2. Is there a minimum amount you have to deposit each month? Basically, can they work with your limited, college student budget. They want college students because odds are, you’re going to be a long term client for them if they are good to you.
  3. Can you deposit more? If you get a windfall of money from a tax return, a birthday gift or just get lucky and win the lottery, can you make a random, extra deposit. How easy is that to do?
  4. Is there a mobile app or web app that you can use to track your investments? Transparency is important so having the ability to watch what your money does should be high on your list. Even if you only check it now and then.
  5. What funds are you investing my money in and why do these make sense for me?
  6. What about taxes? How does that work for your funds?

All in all, make sure you feel comfortable and that you have a handle on the process. If you don’t feel comfortable, then walk away. Maybe one firm won’t be right for you but the next one will be the perfect fit. Feel free to meet with multiple firms and let them know you’re talking to different groups to see what the best fit is for you. No shame in taking them for a test drive first.

I want to hear how it’s going for you so let me know in the comments if you opened an account or have any other tips you want to share with our readers.

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