Investing Homepage

Question: I'm an adult in college: is now the time to be investing?

(Posted by: Stephanie W on 2010-03-11 10:08:49)

I am 27. I work full time and go to school part time. Starting in 2011, I'll switch to part time work and full time schooling to become a music teacher. I don't make a huge amount of money and am paying for school with student loans. I do put $50/ month in an IRA account and I have around $3, 000 in a savings account earning 3 %. I try my hardest to be financially responsible, paying $50/ month towards my unsubsidized loans and trying to pay off my car early. I'm afraid to play with the money I've saved because of the job market and the coming changes in my work/ school arrangements. E*Trade is something that has come to my attention, but I don't know much about it and I am intimidated by the wealth of information available. I don't know where to start. My problem is, I'm not a money person. I'm not a big earner and I don't have much financial knowledge. I think I should be doing something with my money, but I don't know what. Should I be pushing harder to force something to happen or should I just settle for the financial arrangements I have know and wait until after school to worry about investments?

Posted by: Kidneyboy on 2010-03-11, 10:17:13

Now is not the time to "play " the stock market. If you know of a particular investment you really believe in AND you have money invest sure go for it. However I am wary of any students with loans and loans to come "playing " too much with money. And in this economy stocks are not a safe bet even for the pros, it is not the time for people with limited cash, and lack of experience to roll the dice with stocks. At least wait until you are done with school.

Posted by: John on 2010-03-11, 10:18:01

Until you are settled, you should keep your money safe. Paying off debt and keeping a little in a savings account for a rainy day makes sense to me. Getting a little going in an IRA is a good idea. You should probably use a Roth IRA, especailly if you income is low. Your IRA could be invested with more risk since it is a long-term investment. However, if you do not understand the risk, you are better off keeping it safe. If you have $3,000 or more accumulated in your IRA, consider moving it to Vanguard. You can get information at vanguard.com. Don't let the E-Trade babies fool you. Trading stocks is speculative and only appropriate for experienced and aggressive speculators. If you are a sensible long-term investor, stick with low-cost index funds like those provided at Vanguard.