recently came into a windfall of money, and I want to be smart about how I use
it. Some of it will go into savings, but I’d like to invest the rest of it. I
like the idea of getting a head start on saving for retirement while I’m in
college. What are some long-term investments that are good for college
to hear that so many college students are interested in investing. If you start
investing now, your future self will thank you.
important to remember that long-term investments are just that: long-term.
You’re going to have to prepare yourself, mentally, to ride out the ups and downs that you’ll inevitably face with
usually the go-to long-term investment, and that’s because they offer a lot of
they’re paper investments, you don’t have to worry about managing a property or
generally rise in value over the long-term, and in many cases, the value
stocks pay out dividends, which provides you with steady income.
can be spread across multiple companies and industries to better protect
investing in stocks, you might consider growth and high-dividend stocks. With
high-dividend stocks, the yields are usually higher than with fixed-income
investments. Take your time and do your research before investing in stocks,
especially if you plan on using an online trading platform.
to stocks, you might also consider long-term bonds. These are interest-bearing
securities that have terms greater than 10 years – usually 20-30 years. The
primary drawback with long-term bonds is that you’re locked in to a specific
rate for a very long period of time, and in all likelihood, interest rates will
rise during that period.
recommend starting with a balanced portfolio of 60% stocks and 40% bonds. The
bonds protect against risk, while the stocks allow for long-term gains.
option is to invest in mutual funds and exchange traded funds (ETFs). Technically, these aren’t
investments themselves, but rather, they serve as portfolios of different
stocks and bonds. They can be professionally managed, or they can track popular
if you want to diversify your portfolio, you can think about real estate. You
don’t necessarily need to purchase physical property if you want to get into
the real estate industry.
real estate investment trusts, allow you to invest in real estate without the
complication of owning and managing property. The advantage of REITs is that
you can invest in them the same way you invest in stocks. When you buy into the
trust, you enjoy part of the ownership and profits of the underlying real
functions similarly to a high dividend paying stock. At least 90% of their income must
be returned to investors via dividends. For this reason, REITs are one of the
highest-yielding investments out there.
You have a
lot of options when it comes to long-term investments, so weigh them carefully.
Take your time, and enjoy the process.