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10 Good Investments For Beginners

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Good Investments For Beginners


In this article, we will give ten options for good investments for beginners. If you’re new to investing, you may be wondering where to start.

There are many different types of investments available and it can be overwhelming if you don’t know what your options are.


Table of Contents


High-yield savings accounts

High-yield savings accounts are great way to invest in your future. They offer a higher interest rate than a regular savings account, which can help you achieve your financial goals faster.

So where can consumers find high-yield savings accounts? Well, they’re offered by many different institutions, including banks and credit unions. One example of such an institution is Alliant Credit Union, which offers several high-yield savings options for its members.


Certificates of deposit (CDs)

When it comes to investing, You should always feel confident that your money is in a safe place. Certificates of deposit (CDs) are a great way to invest in low-risk products with FDIC insurance. You can use CDs for short-term savings or long-term investment goals like retirement.

CDs are ideal for new investors because they come with a guaranteed interest rate and have no risk of loss due to market fluctuation or poor performance by the bank holding your funds.


Money market funds

The most common money market funds are “prime” and “tax-free”. They invest in short-term debt such as corporate bonds and Treasury bills (short-term U.S. government bonds).

Money market funds differ from mutual funds because they don’t actively manage their holdings. They simply buy whatever bonds are in their portfolios at any given time, without trying to predict which ones will perform better than others over time.


When looking into which types of money markets might fit best into your portfolio:

  • Look at how much interest each fund pays out annually

  • If possible look up historical values so that you know whether recent fluctuations were unusual

  • Consider how long its average holding period has been over its life cycle so far (some may hold onto longer term bonds within their portfolios while others may sell them off immediately)

  • Take note whether or not there are minimum balance requirements before withdrawing anything.

  • There are several different options available when searching online; some examples include Fidelity Money Market Trust, Vanguard Federal Money Market Fund.


Exchange-traded funds (ETFs)

Exchange-traded funds (ETFs) are a popular investment choice for beginners, and for good reason. ETFs give you exposure to stocks, bonds, commodities and other asset classes in one package, making them an efficient way to diversify your portfolio.

One of the best things about ETF investing is that they allow you to participate in multiple types of investments with only one purchase.


Dividend-paying stocks

Dividend-paying stocks are a good investment for beginners because they can help you build wealth over time. Dividends are distributions of company profits paid out to investors each quarter, and these payments often increase over time as the company grows.

Dividends are similar to interest payments on bonds. They’re not guaranteed but rather subject to fluctuations with the economy and stock market prices. If there’s less demand for dividend paying stocks (or higher risk), then they may pay less than expected. If demand is high and markets go up at a rapid pace, you could earn more than expected too!


Mutual funds

A mutual fund is a collection of securities that are professionally managed by a portfolio manager. These securities can be bought and sold like stocks, but they’re not stocks themselves. You can use these funds to invest in stocks, bonds, or other assets.

Mutual funds have fees associated with them that vary depending on the type of fund you choose (index vs actively-managed). While it’s true that you can save money by investing in your own index funds at discount brokerages like TD Ameritrade or Fidelity Investments, there’s no need to do so when there are already plenty of high-quality options available out there for free!


Treasury securities

Treasury securities are what's known as debt obligations issued by the government of the United States. The bonds are considered to be the safest investments in the world, because they’re backed by the full faith and credit of the U.S. government.


Corporate bonds

Corporate bonds are debt instruments issued by companies. They are considered a safe investment because corporate bonds are backed by the company’s assets and their risk of default is low.


Robo-advisors

Robo-advisors are a type of digital advice platform that provides automated financial planning and management services. By using computer algorithms to trade on your behalf, robo-advisors can help you invest your money in the most efficient way possible.

The best robo-advisors will:

  • Help you set up an investment portfolio with low fees, diversified investments, and low turnover rates. Robo-advisors typically charge a lower fee than human advisors because they don’t need to pay for salaries or office space.

    They simply take a small portion of the profits from each trade made by their clients’ portfolios. To keep costs down and make sure you get the best returns on your investments. It’s important that you choose a robo-advisor that offers low fees (less than 0.50% annually).

    A good rule of thumb is asking yourself if what they’re offering is worth more than $50/year. If not then it probably isn’t worth it for them either!

  • Keep track of all major accounts/instruments held across several different institutions automatically, including 401(k) plans and retirement savings accounts, so there’s nothing left out when calculating how much money has been saved so far over time.


Individual retirement accounts (IRAs)

Individual Retirement Accounts (IRAs) are tax-advantaged retirement savings accounts available to most people with a job, and those who don’t have a job may be able to open one. They’re like 401(k)s for those who make less than $10,000 per year.


We hope you’ve found this list of investment ideas useful for beginners. While we certainly don’t recommend that everyone should invest in the same things (and you shouldn’t feel pressured to do so), we do think that investing is one of the best ways to build wealth and prepare for retirement.

So if you want to be a successful investor, we think it makes sense to start small with some of these investments before diving into others.


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