How to Start Investing

By: Dave Roos
Relax. Where you are right now is a good place to learn how to invest. See more investing pictures.
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When you're fresh out of college, planning for your financial future may mean brown-bagging your lunch so you can afford to go out to dinner with your friends. But after a few years of living paycheck-to-paycheck, you might be pleasantly surprised to see that your checking account balance is actually growing month by month. So what should you do with that extra $100 or $500? You could buy a Nintendo Wii, pick up the new iPhone, or you could invest your money.

Investing doesn't have to be scary. And it's not just for people with thousands of dollars in spare cash. In fact, the earlier you start investing, the more you can take advantage of the miracle of compound interest. The little you can start investing now could reap huge rewards 30 years down the line. Every good plan starts with a clear statement of goals. Where do you want to be in five years, 10 years or even 50 years? If you know what you want, a solid investment plan will help you get there.


B­ut first, you need to understand investment tools. Choosing a broker is a crucial part of your investment plan. An expert can give you guidance, but you'll pay for his or her advice. Whether or not you hire a broker, it's good to learn about investment strategies. Successful long-term investing isn't just simple guesswork. But it doesn't have to be rocket science either. There are some basic formulas that even new investors can use to maximize their returns year after year.

Armed with your new knowledge of stocks, bonds, mutual funds and investment strategies, you'll be ready to invest. In this article, we'll walk you through the basics of how to become a successful investor, explaining the safest strategies for making your money work for you.