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Adulting 101: Where Millennials Should Invest Their Money


Young millennial investors who want to open a savings plan have it difficult. That’s due to the wide range of investment options they can choose from. You can find a lot of products and services, making it challenging to select an option. In addition, numerous companies deliver them in different packages.

If done right, investing is the best way to grow your money. Most types are accessible to anyone regardless of career, income, or age, but such factors can influence which types are the best for you in your current situation.

Here are some options you have for a traineeship program and investment, generally sorted according to risk—from lowest to highest. Bear in mind that lower risks also mean lower returns.

  • High-yield Savings Accounts

Online cash management and savings accounts offer higher rates of returns. You can get these in old-fashioned bank checking or savings accounts. Your cash management accounts are a combination of both. You can earn interest rates similar to bank savings accounts, but brokerage firms often offer these accounts with checks or debit cards.

Opening a savings account is ideal for short-term savings or if you want to keep money that you can only access occasionally. It can be for a vacation or an emergency. Your cash management accounts offer higher interest rates and more flexibility.

Online banks tend to offer higher interest rates than what you’ll get from traditional banks due to cheaper overhead costs.

  • Certificates of Deposit

Your certificate of deposit (CD) is a federally insured savings account. It offers a fixed interest rate for a specific amount of time. It’s ideal for the money you know you’ll have to access after a particular period. You can choose between the one-year, three-year, or five-year term lengths.

If you want to safely grow your money for a specific goal within a particular amount of time, a CD is the best option. But if you need to access your money earlier, you’ll have to pay the charges. You should pick the best term length if you have plans of buying a CD.

  • Money Market Funds

Money market funds are investment products, unlike money market accounts. Money market accounts are bank deposit accounts similar to savings accounts. If you invest in money market funds, your investment accumulates high-quality, short-term corporate, bank, or government debt. Money market funds are investments you may have to use soon that you’re willing to invest in a bit riskier market.

Investors use these funds to keep a portion of their portfolio in a safer investment than stocks. That makes these a holding pen for money allocated for future investment. You can’t expect higher returns from these funds, even if they’re an investment. Your fund’s growth is similar to the growth you can yield from a high-yielding savings account. You can buy money market mutual funds from a bank or mutual bond provider.

  • Mutual Funds

Mutual funds accumulate money from investors to buy bonds, stocks, or other assets. It can also provide you with an affordable means of diversifying your portfolio; it refers to investing your money in different investments. It helps you minimize your loss from a single asset. If you’re saving for a long-term goal, pick mutual funds.

Mutual funds are the easiest ways to get excellent investment returns without managing and purchasing a portfolio of individual stocks. Most mutual funds restrict the scope of their investments to companies that fit specific criteria, allowing you to focus on certain markets. You can buy mutual funds from discount brokerage firms and finance firms.

  • Exchange-traded Funds

Exchange-traded funds (ETFs) are similar to mutual funds in a way that they are collected from different investors to purchase a collection of assets. They offer a single diversified investment, but the only difference is how brokerage firms sell these. Investors buy shares of ETFs like they’d buy shares of an individual stock. ETFs are a good investment if you have a specific timeline in mind.

In addition, these funds are ideal for individuals who lack sufficient money to meet the minimum investment requirements for mutual funds. That’s because an ETF share price is lower than a mutual fund minimum.

  • Real Estate

Traditional real estate investments entail finding a mortgage company, buying a property, and selling it after a few years for a profit. Or you can own property and collect rent for a fixed income. One common type is through real estate investment trusts (REITs). REITs are companies that manage income-generating properties and offer regular dividend payments.

Real estate crowdfunding platforms have also gained popularity in recent years. It can accumulate investors’ money to invest in real estate projects. Even if you already have a healthy investment portfolio, you can still avail of these. These funds can help if you’re willing to take more risks earning higher returns or are looking for further diversification.

Building wealth through these options can start at any income level and age. You should pick the suitable investments based on how many investments you need, how much money you have, your risk tolerance, and your timeline.

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