Top Ways to Invest While You’re in College
Investing money isn’t some kind of privilege reserved for adults that have steady income. In fact, most teenagers are unaware there’re several top ways to invest while you’re at college too.
Understandably, this might sound strange to every college student. Because you could be finding that money that parents provide for expenses just isn’t enough. However, shortage or the need for more money can easily be overcome by working part-time or as freelancer while studying.
In fact, there’re several advantages of investing while at college.
Benefits of Investing While At College
- Your money grows and pays rich returns in later years.
- Investing helps you learn how to make money work.
- You get to learn a lot about stock markets, savings and investment plans.
- Investing while at college will definitely help you achieve your dreams.
- Responsibility is something you learn from investing.
- Savings habit also develops when you start investing.
- It’s fun to watch your money grow.
- Investing teaches you value of money.
These advantages or benefits aren’t the only ones. There’re quite a few. However, these main benefits of investing while at college should help you decide.
And if you actually decide to invest while at college, here’re some top ways.
Top Ways to Invest While at College
It’s not really necessary to have lots of money to invest while at college. You can start with as low as $5. This might sound unbelievable, but I’ll show you how.
Download Best Investing Apps
Most teenagers and college students want to get that first-hand feel of investing. Becoming a Do-It-Yourself investor is fine. And these apps can help you become an excellent investor for future. Some of the topmost investing apps for teenagers and college students include:
- M1 Finance
- Personal Capital
- Apps from Your Bank/ Credit Union
These apps have a feature known as Robo-Advisor. It means, a robot will calculate how much money you wish to invest and display the best available options. You can choose any of these options to invest while at college.
You can start your investment journey for as little as $5 only. In fact, apps such as Stash give instant credit of $5 to $10 when you make your first investment. Other apps waive off transaction and service charges that apply when you invest.
Learning about various attractive investment options is an added advantage of using these apps.
A lot has been written about Mutual Funds. In simplest words, a Mutual Fund is a collection of stocks or debt or other financial assets. They’re consolidated by a financial institution and offered as a unit to retail investors like us.
The apps I’m mentioning allow you to invest in Mutual Funds. Alternatively, you can invest directly from the websites of various financial institutions and Asset Management Companies. Some companies don’t have a minimum investment limit for younger investors, even there are many direct mutual funds which comes with a great return.
Exchange Traded Funds (ETFs)
Exchange Traded Funds or ETFs provide an excellent opportunity to invest in various sectors such as real estate and vices (including weed, tobacco and alcohol) and lots of other industries. An ETF is also a Mutual Fund of sorts. However, an ETF is traded daily on stock exchanges.
It’s possible to open an investment account with your bank or credit union and invest on ETFs while at college. Additionally, the above apps also help you to invest on ETFs. Personally, I find ETFs are excellent ways to make your money grow. And the selection of sectors for investing on ETFs is rather large.
Systematic Investment Plan
Systematic Investment Plans or SIPs are ideal for college students. They enable you to invest small amount of money every month on a Mutual Fund or ETF. The best way to open an SIP is to register directly on the website of Mutual Fund provider. Select the industry or Mutual Fund of your choice and submit the online registration form.
An SIP is the best way for bringing about discipline in your savings and money management skills. A financial institution or AMC will directly debit the money from your bank account every month. And there’re no penalties for skipping a monthly installment if you’re short of funds at the time for any reason.
There’re two ways to invest in foreign currencies while at college. You can either buy foreign currency notes from an exchange house to keep them safe to sell when the price goes higher and you can make good profits. Or invest on foreign currencies through any of these apps or your bank.
Foreign currency markets fluctuate wildly, especially in times of political problems in distant country or trade related issues. This gives you an excellent chance to buy them at cheaper rates. You can either hold the currency in cash or on a forex account. Whichever way, it’s possible to start investing as low as $10 on foreign currencies.
Gold, silver, lead, crude oil and certain food grains feature as commodities on the international market. They’re a flourishing trade in these commodities that goes on round the clock and is perfectly legit. Investing on commodities also doesn’t require much money. Anything from $30 would be enough to enter the global commodities market.
You can benefit from the highs and lows of the international commodities market by investing a little money as college student. The feature is already available on some of the apps I mention below. Additionally, you can also open an online account with countless legit commodity trading platforms that work from USA.
Term Deposits/ Monthly Deposit Plans
If you have a larger sum of money by working while at college or have managed to save some, invest on a bank Term Deposit plan. This is the best way to invest as college student if you’re looking at very safe avenues to stash money.
Alternatively, it’s also possible to open a monthly deposit plan. Here you can invest small amounts of money every month and watch it grow. The bank or credit union also provides a nominal interest on your investments. These returns won’t be higher than the options I mention above. However, your money remains safe.
You’ll definitely see from my above examples that it’s not necessary to have a small fortune to start investing while at college. Even a small sum of money would be sufficient. And if you do it in the right way, these investments can grow to a large amount by the time you start working for an income.