Simple Options for People New to Investing

new to investing

Planning for the years ahead, or for your retirement, involves a lot of strategic financial management. And as we’ve noted in the past, this should involve a process of investing sensibly. Generally, this means finding low-risk opportunities that you can afford, but may still profit from. However, that can be easier said than done!

If you’re not someone with a lot of financial management or investing experience, it can be a little bit difficult to know where to start. The stock market (which most people think of first when they hear the word “invest”) is daunting if you don’t have experience, and beyond that it may just be that not many alternatives come to mind. So to offer a bit of help, we’re going to briefly cover some fairly simple options that can make for sensible investment — even for a relative beginner.

Use a Professional

The simplest way to go about a fairly conventional investment is simply to trust a professional to manage your portfolio. This can be one through a number of different avenues, and it’s not a foolproof option. But keep in mind that there are experienced professionals who manage others’ accounts for a living. The downside is that you need to pay (usually a percentage of your return) to enjoy this kind of service. But if you’re intrigued by market investment and unsure how to go about it, you can always seek help from the pros.

Use a Robo-Advisor

A “Robo-Advisor” is basically an automated investment solution, and it’s something that’s gone a lot more mainstream in recent years. Available through both apps and online services, robo-advisors can basically manage portfolios according to your guidance. To be clear, this means that an automated solution like this is not making all of the decisions for you, nor providing any sort of broad market expertise. Rather, it can take your directions and use them as parameters, within which it will take a purely analytical approach to trade successfully. It’s still a fairly simple solution though — particularly with regard to some arrangements that present you with basic options regarding risk level, asset bundles, etc. In those cases, establishing your directions of parameters is an easy process, and the robo-advisor does the rest.

Look to Mutual Funds

A mutual fund is another version of the ideas above, in that it is an investment managed by a professional (and in some cases, a similar arrangement can be automated). To cover this concept more specifically though, a mutual fund pools money from a number of investors, to give the fund manager a greater total sum to invest with. Each individual investor then earns back profits proportional to his or her contribution (minus service fees). There are different kinds of mutual funds, and some offer more favorable arrangements than others. But by and large this is one of the simplest ways to buy into the stock market.

Look to Gold

Outside of stock market investment altogether, gold is another option that requires relatively little activity, and which people view as being largely reliable. While the valuable metal is subject to possible declines — like any asset or stock — gold’s price charts going back many years show why it has gained a reputation as a strong investment. It has a tendency to make slot gains over many months or years at a time, meaning investments require very little short-term management. You have the option of simply buying in, leaving your investment alone for a long period of time, and hopefully withdrawing gains when the time comes.

Try Real Estate

Another option outside of stock markets is real estate investment. This is basically the buying and selling (or renting) of property with the aim of profiting over time. And though this is a slightly more involved process, there are benefits of real estate investment that lead some to pursue it as a simpler way to make money over time. These benefits can include cash flow (if you’re renting), tax benefits, and gradual appreciation — all of which can be appealing for a long-term arrangement.

Making money on an investment is never a definite proposition. But for those looking to invest sensibly, and seeking simple options, the ideas and methods above can be of use.

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