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What every 21 year old should know about investments
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What every 21 year old should know about investments

As a 21 year old, you’ve probably started earning by now, and finally want to try and make sense of investments. Up until now, the only thing you know about investments is it’s that junk the old dudes were always talking about at the parties your parents threw when you were a kid, suddenly sounds a lot more interesting though doesn’t it? No worries boys n’ girls, I’ll bring you up to speed.

The internet is a resource for finding out the basics of the different types of investments and their pros and cons, if I were to go into that, first off I’d have to write a 20 page essay, and you guys would probably fall asleep before you went past even the second paragraph. Instead, do your research. To start off, check out what bonds, stocks, mutual funds, options, futures, foreign exchange, real estate investments and investing in gold are all about. Take up only 2 a day, and spend an hour researching each topic, that’ll be enough to give you some clarity before you invest. Once you know what you’re getting into, follow these tips –

  • Diversify: don’t ever, ever put all your investment eggs in one basket. It’s rank stupidity, because even though you might hit upon a winner and become an overnight millionaire, you might as equally pick up a dud and go broke overnight. Doing this would be like taking all your dough and betting it on 00 at a roulette table, it’s like tempting fate, and that almost never ends well.
  • Emergency fund: For further safety, keep an emergency fund aside. If you put all your money in investment options, you might not be able to take it out when in times of desperate need depending upon the kind of investments you’ve made. You’d rather have a small stash in the locker for a rainy day.
  • Pay off before you invest: Your first priority should be debt clearance, only then should you go into investments. Get rid of that college tuition debt from your earnings first, and only once your books are balanced, should you develop your portfolio.
  • If it appears to be too good to be true: If you think this deal is unbelievable, turn around and run! It’s usually a scam so don’t fall for it. Even when you invest in what looks like a legit operation, read the fine print before putting pen to paper, and don’t put cash up until a legal, written agreement is in place and signed by both parties. There are too many scam artists out there, don’t be their bait.   

Those are my tenets to being a successful young investor, and while you may make a few losses, don’t be disheartened, because you’ll learn from them, and build a proper tower of cash before very long.

About Karen Durkins

Your very own guiding light for all-things-business. Personal Finance advisor by profession, career counselor by choice – always happy to help!



    Inspiring story there. What happened after? Thanks!


    Hello there! This post could not be written much better!
    Reading through this post reminds me of my previous roommate!
    He constantly kept preaching about this. I will send this article to him.

    Fairly certain he will have a good read. Thanks for sharing!

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