Putting money to work while in school
Most people don't think about investing money while they are in college. Should you really put your money to work this soon? Here's the short answer: you can start investing money at any time.
In The Richest Man in Babylon, George Clason said that the best way to get rich is to take out 10% of your income right away and put it somewhere where it will work for you. Of course, this is also true for college students.
Even if you don't make much money and don't have much saved up to invest, you can start learning how to do it while you're in college. That way, when you do have a lot of money, you'll know exactly what to do with it. Here are some tips for investing that will help you avoid the mistakes most people make and get you on the fast track to financial freedom.
Before you start investing money in college, there is one thing you need to know: you should always invest in well-run companies that have a long history of making money. Most investors make the mistake of thinking that the best stocks are small, risky ones that no one has ever heard of. Even though some investors have made a lot of money with these riskier investments, the vast majority lose money or barely break even.
Next, stick with a company you know well so you can figure out how profitable it is and how bright its future looks. This is a key strategy that Warren Buffet and other successful investors use, and it's a big reason why they're so successful. Think about this: if you invest in a company you don't understand, how can you know how much money it will make in the future?
For example, if you play golf a lot, it will be easy for you to figure out how well a golf company is doing. For example, if you play with 5 straight people who all hit Titleist drivers and all your friends use them, you can bet that Titleist is making a lot of money.
In fact, Peter Lynch, a very successful mutual fund manager for a long time, said that one of the easiest ways to find a good place to invest is to go to the mall and see which stores a lot of people are going to. If a store is busy, you can bet that it is making a lot of money.
No matter what, keep in mind that investing money while you're in college can never hurt you and can give you a lot of experience that will help you when you're older. If you follow these tips, you will be well on your way to being financially independent at a young age.
