There are no excuses for young people not to invest. It’s the time of life when you’re supposed to start investing so that you don’t have to play catch-up when you get older, which is much harder to do than find the money for savings when you’re young. Check out these popular excuses young people use to avoid investing stop them from building their nest egg decades ahead of time so that they can enjoy a comfortable life during their retirement.
Not Enough Money for Investment
While it might be true that young people don’t make as much as matured adults do, it’s not a good enough reason not to invest at all. You don’t need a fortune to start investing, the goal is to have one when you’re done. The first step for young investors is to start a 401(k) plan with their place of employment, or start a Roth IRA. This way, even small investments can grow when their retirement account is faithfully contributed to each year.
No Investing Knowledge
No investor starts off with all the knowledge of the ins and outs of investing. A lack of knowledge is no reason not to try something, but often young investors will use this excuse to not even try. What you need to do is take advantage of all the cheap and even free information on how to invest wisely. Young people can use the Internet to access social media sites about investing, they can attend webinars, and even use public forums to ask question and get answers from real financial planners.
Investing Is Too Risky
Investing can be risky, but it’s not too risky when it’s managed properly. Young investors who want to place it safe can choose more conservative portfolios, like blue-chip stocks and bonds. Investors who want to take a little more risk can enter more aggressive positions with the possibility of higher rewards. Being conservative isn’t a bad thing, but taking risks every once in a while could mean big payoffs that can really make a difference in your retirement account.
I’m Still Young, Investing Can Wait
This is the worst mistake young investors can make. Saving for retirement and investing doesn’t get easier as you get older. Older investors are more experienced because they’ve been investing since they were young, which is why they are so knowledgeable. The best idea is to start young, because you have time to build an impressive portfolio and make bigger and more aggressive investments as you get older. Retirement planning isn’t for those approaching retirement. It’s for young people making wise choices for their future.
The Only Thing I Need Is a 401(k)
A 401(k) is a valuable thing to have, but if you want to live a certain lifestyle when you reach retirement, it’s won’t be enough. Besides contributing to your retirement account, you need to actively invest your savings because that’s where the bulk of your money will come from. Though 401(k)s are safe, they don’t accrue money very quickly, but investing can both make more money and make it faster.
There are more excuses young people use to avoid investing, but these main arguments are used the most frequently. Don’t let simply being young stop you from planning your future. Everyone gets to be old enough for retirement, but not everyone gets to live the retirement life they want unless they’re prepared to plan, save, and invest for it.