Now that we’ve covered some of the basics of financial literacy and looked into ways to cut back on your spending’s. I’d like to introduce the topic of investing. Before we go any further, I just want to clarify that I am by no means a professional and nothing I say should be considered advice, this is just the way I view investing.

When most people think of investing, they think of stocks and some of the more popular companies like Apple, Tesla, and Amazon (to name a few). There’s certainly money to be made here, but it involves a little bit more thinking, so for most people (myself included) I think it is important to take a simpler approach to investing. There’s a specific type of investing that I find to be the most useful for a new investor, and that is through low cost index funds.

Index funds are a portfolio of stocks that you can buy into at a relatively low fee (when compared to traditional mutual funds that are managed by someone else, which I would not recommend, but more on that a different day). An example of an index fund would be FXAIX, which is an index fund that tracks the S&P 500. When you buy FXAIX, your money is spread out between the top 500 companies in the US, which means that if one stock inside of that 500 is doing bad, there is another to pick it up.

Index funds are investing made easy, the returns may not be as high as other potential investments but they are low risk and offer consistent positive returns, perfect for long term investing.

There is much more to talk about regarding investing and index funds but I don’t want to overwhelm you so for now I’ll leave it here. I highly recommend doing more research on your own if this is interesting to you, there are tons of good resources about index funds online and in books!