Growing up, my family of four had a large, two story house with a well-manicured green lawn, swimming pool, and swing set. My mom was able to stay home and care for my sister and I and we were all supported by my dad’s income. This is the American Dream that people have fantasized about for decades, but what happened to it?
When I got my first job out of college, I barely made enough money to feed myself, keep a roof over my head, and have some sort of social life. This was a stark contrast to what I had always imagined adult life would be and it’s a reality that many people of all ages are facing today. Has the classic idea of the “American Dream” become unattainable? Or, has it just morphed into something else?
It would seem that the “Dream” is no longer to own a large house in the suburbs with an SUV, a golden retriever and a white picket fence- all before blissfully retiring in Florida at age 65. Now, the “Dream” is freeing yourself from debt, contributing to a 401K and saving as much as you can, and having enough money saved to retire by the time you are 80. Even in the face of this “new Dream,” people are struggling – costs of living are high and job creation is low.
An answer lies within reach – learn how to invest in stocks and ETFs. Up until recently, my excuse was that I did not have enough disposable income to even think about retirement savings, let alone learning how to invest in stocks. What I didn’t know, is that I could invest a small amount of money each month and still build a portfolio that would be beneficial to me in the long run.
Getting Your Investment Portfolio Started
As a beginning investor, it may be wise to start out investing in low cost stocks or ETFs for the long term. Invest a small amount of money as often as you can and let it work for you! One piece of advice offered up by Warren Buffet himself is to own low-cost S&P 500 index funds. This may be a good option for those of us who are just starting out and do not have a lot of disposable income.
If you are still doubtful of whether you should take what little disposable income you have and learn how to invest in stocks, consider the following example from CNN Money. If you invest just $19 per week at 8% starting at age 25 and stop at age 35, you will have earned $169,000 by age 65. If you invest the same amount per week starting at age 35 and ending at age 65, you only end up with $125,000 at age 65. So, as far as retirement is concerned, it may we worth it to invest your beer money every now and then.
By Nicole Dugan
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