Do you remember what you were doing at 17 years old? 🤔 I can tell you I don’t remember (and if I did it would probably be too embarrassing to share).
I know one thing that I wasn’t doing, thinking about investing.
Anytime that I have a 17 yr old, or any teenager, that has watched my videos or read my blog and asks me how to get started investing, that blows my mind. 🤯
Recently I had a 17 yr. old that contacted me to find out how to start investing. I want to share with you what I shared with him. The actual steps and strategies that I gave him to get started investing today.
The reality is if he starts investing in his teenage years, it could be with stocks, mutual funds or something else, he may or may not make money. Chances are he will probably lose money. He could take a little bit of a loss on his initial investment or he may make a little. But, BUT, what he is going to get out of this is a lot of experience. So much more experience than others that are reading books, watching videos, etc., all the research before they make their first investment.
You learn so much more by actually doing than you do by researching.
You learn so much more by taking action. 😅
You are going to be so far ahead of the curve, so far ahead of the initial struggles that older people go through when they finally start investing. 👴
If you are getting all of this out of the way as a teenager, you have so many strategic by-products of taking that initiative and taking action.
By the time this person is in their 20s they are going to be so much more experienced in the investment game for just jumping in and getting started.
So let me dive in to some of the specifics.
The question was how to invest around $3K with some long-term low-risk and some high-risk short-term investments. Enough to grow a safe cushion to be able to start his own business without having to get a side job.
So this is a complex question. We only have $3k and we have short-term and long-term goals AND want to fund a business. The reality is when we start to diversify and split all of this up, it doesn’t leave us a lot leftover to do a lot of things with. We have to be very specific with the ultimate goal.
Every new or experienced investor gets caught up in short-term gains.
Let’s say we take $1,000 and invest it in stocks, ETFs, mutual funds, whatever. Let’s say that makes us a 10% return in the first year. At the end of the year we have only made $100 on our investment.
Also, if you are attempting to make 10% you run the risk of losing 10% or even more.
If you have unrealistic expectations, chances are you are are going to put your money into something that is too aggressive.
I have to assume that to have this amount saved, he must have a job or some form of income. So, I highly suggest that he open a Roth IRA. Now if he is 17, he will have to do this with the help of his parents.
He will be building money for retirement, but with a Roth IRA, he also has the ability to take that money out at anytime.
So besides the Roth IRA, the other option that I really like speaks to the part of his question about starting a business. The answer is to start that business. In the long-term, if you can stick to it and find something that you like this will get you the largest ROI than any of the other things that I discussed here and in other videos. 💰💰
Of course there is risk in anything and that includes starting a business.
You have to be willing to stomach some risk. There will be times that you will lose money or break even. But if you stick to it, keep learning and developing yourself, you will find something that will yield a nice profit.
So for him, for you, for anyone watching this - starting a business, especially an online business will be your best opportunity to realize the biggest ROI.
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