I am 39 years old and know nothing about investing my money, how do I get started and what is the best way to get started?

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Answers (1)

Answers (1)



Thanks for posing the question, and for taking the first steps to start investing!  The world of investments can be a little intimidating, but there are some simple steps I can share to help you get started. 


1. The Goal

First, take stock of why you want to invest, and what are you trying to accomplish.  Are you saving for a big purchase like a car or home?  Investing to fund kids' future?  Or are you wanting to put money away for your eventual retirement?  It sounds simple, but making sure you know why you are investing definitely changes your strategy on what route you take.


2. The Funding

Look at your personal financial situation and what resources you may have.  Do you have an upfront amount you want to invest?  Or maybe a regular contribution?  For most people, their greatest resource is their ability to work and earn money.  At 39, I'm going to make the assumption that you have many years left to work and earn an income.  Part of your goal needs to be to capture and keep a portion of that income.  While some investing plans can start for as low as $50 per month, the amount you can commit to, on a regular basis, dramatically impacts your ability to meet your goal.


3. The Time

Consider when you may need the funds.  If you are saving for retirement a long ways out you may be able to take greater risk with the investments.  If you are using the investment to take a family vacation next year, you will likely want to use something much safer (so the vacation actually happens).


4. The Risk

Related to time, the amount of risk you take in an investment determines how much it could go up, or down, in value.  Higher risk investments like stocks can move 40% or more in a given year, so you need to take stock of your appetite for risk.  More conservative "investments" like savings accounts don't grow all that much, but they don't usually go down in value either.  Be honest with yourself on this and pick a level of risk you are comfortable with.  If you are newer to investing it may still be appropriate to take higher risks, particularly if you have a long time frame and are saving new money on a regular basis.  We also recommend that you diversify your investments, across a range of investments, to help reduce the overall risk of your portfolio. 


It's a common mistake for investors to change their investments to risky ones when the markets are going up (when prices are high and everyone feels great), and change to more conservative options when markets are down and they are nervous (and it's doom and gloom).  The best way to approach risk is to set a level you are comfortable with and remember your long term goal, regardless of the day to day ups and downs.


5. Get advice

I know you reached out in this forum, but would need to know more about your specific situation, to make a specific investment recommendation for you. There are a couple of places I'd steer you for a more complete answer.


Talk to a financial advisor with USAA at 800-472-USAA (8722).  This service is a no-cost benefit to your membership, and can really help.  An advisor will ask you some questions about what you want to accomplish, some questions about your finances, and recommend some concrete next steps.  If you want, they can also give you advice on your overall situation, making sure that your investment decisions fit into a good overall plan.  Don't be nervous, I've worked with these people for years and they will take care of you.


Learn more on your own:

Check out the Investing Advice Page with links to more information and tools to help you get started. 

You can also check out a post by one of my colleagues that talks about getting started saving for retirement that might help Start Now - Save for Retirement



Thanks so much for your question, and good luck!