Saving money is never a bad thing, right?
You take a percentage of your check every payday and tuck it away in a savings account.
Youre doing what youre supposed to, right?
Wellllllllll,kind of.
Unfortunately, saving alone will never get you to retirement.
Youre on the right track, but the money youre stashing away isnt growing like it could be.
Lets take a look at why this wont work and what you should do instead.
The Downside of Saving
To retire comfortably, it’s crucial that you grow your money.
Saving money is all well and good, but it wont reallygrowyour money.Thats what investing is for.
Heres the thing about savings: Lets say you put your money in a savings account at a bank.
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And if you bank with a big national chain, your rate is probably even lower.
The best-known brick-and-mortar banks often give you a measly 0.01% APY on savings accounts.
What does that mean?
Thats right a penny.
You may as well shove your money under your mattress for all the good thatll do you.
Did you know?
Stock prices go up and down.
But over time, they generally rise by 7% a year.
Lets say you invest $100 in stocks.
Instead of earning a penny after a year, youd earn an average of $7.
Lets say youve got $1,000 saved up.
Now lets think a little bigger than that.
Lets say youve got $10,000 in savings.
You see the difference?
How to Start Investing?
If you feel like you dont have enough money to start investing, youre not alone.
You really dont need that much and you could even get free stocks if you know where to look.
Whether youve got $5, $100 or $800 to spare, you could start investing withRobinhood.
Plus, its super easy to use.
Theres also the chance you could strike it rich.
They basically doubled their money or more.
The best time to start investing was a year ago.
The second best time to start investing is right now.
Mike Brassfield ([email protected]) is a senior writer at The Penny Hoarder.
Hes not rich, but you better believe he invests.
It sounds appealing right?
Check it out here!
