Good Morning Green Panda friends.  Let me ask you a question, how do you invest your money? If you are in college your main financial priority is probably paying your tuition, it’s not investing money on a monthly basis.  However, if you can afford to do so you should try and save a little bit of money each and every month.

If you are new to investing then it can be a challenge to find the type of investment that is perfect for you. College students don’t always have a lot of time to research their different investment options, but don’t worry Green Panda is here to help.

College students are most likely not able to save a lot of money on a monthly basis.  The key to saving money in your 20s is to invest as much money as possible in an investment account that has the lowest possible transaction and administration fees.

Check out these different investment options for college students:

– Cash Savings in a High Interest Account.  If you don’t meet the minimum requirements for a mutual fund or other type of investment account then saving your cash money in a high interest savings account may be the best option.  Investing your money in a savings account is also a great way to save for an emergency because you have access to the money at any time.  Although having access to your money at any time can be both a gift and a curse.  If you have access to your money at any time you may be tempted to dip into your savings even if you don’t have a financial emergency.

– Investing in Mutual Funds.  Mutual Funds are a good option for new investors because mutual funds are diversified investments; this means that your money is invested in several different types of individual investments without actually purchasing several different individual investments. Mutual Funds are pooled investments that usually have low initial investment requirements.  They also allow investors to save money on a regular basis with pre authorized payments. Mutual Funds come in a variety of different options such as low risk Bond Mutual Funds and higher risk International Equity Mutual Funds.

– Saving for Retirement.  If you are in college then you probably have many different financial goals to achieve before retirement.  You may want to buy a car, save for a down payment on your first home and pay off your student loans before you retire.  However the truth is that allocating even a little bit of savings in your 20s towards your retirement later in life can save you a lot of money thanks to the beauty of compound interest.  When you invest your money it earns interest each month, this means that in the next month you will earn interest on your initial investment plus the interest earned in the previous month; this is the beauty of compound interest and all good investors, both new and old, should take advantage of it.

How do you invest your money?

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