Getting Your Feet Wet – Start Investing

If you are afraid to get your investments started, you can get started right away without having a lot of knowledge about the stock market. Start by being a cautious investor with a low risk tolerance. This will give you a possibility of making your money grow while you are studying a bit more about investing.

Begin with an interest bearing savings account. Probably you already have one. If you don’t, you should. You can get a savings account at the same bank where you do your checking at – or at any other bank. A savings account should pay 2 – 4% on the sum that you have in the account.

That's not a lot of money – except if you have a million dollars in that account – but just see it as a start, and hey - it is money making money.

As next step, invest in money market funds. This can often be done through your bank. These funds have bigger interest payouts than typical savings accounts, but they work much the same way. These are short term investments, so your money won’t be tied up for a long time – but again, it is money making money.

Certificates of Deposit are also sound investments without a risk. The interest rates on CD’s are typically higher than the rates of savings accounts or Money Market Funds.

You can choose the time period of your investment, and interest is paid regularly until the CD reaches maturity. CD’s are avaliable at your bank, and your bank will even insure them against loss. When the CD arrives at maturity, you get back your original investment, and on top of that the interest that the CD has earned.

If you are just beginning, one or all of these three types of investments is the best starting point. Again, this will allow your money to start making money for you while at the same time you learn more about investing in other places.