Lets start Investing

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Lets start Investing

Introduction to Investing

Would you like to buy that mountain house you always wanted, sport a brand
new car that is paid off, or even retire with millions? Saving $1000 a month
from the age of 20, until the retirement age of 60, with a low bank interest
of 3% will only leave you with $929,000. A million bucks seems pretty nice.
But it takes a lot of hard work to save $12,000 a year and let's not forget
that inflation will lower the buying power of that money. The inflation will
set that $929,000 of today's money to about $480,000 of tomorrow's money.
You could buy the house but maybe not retire with millions. You must also
consider living expenses.

There are alternatives to JUST saving - You could invest your money.
Investing is taking a risk that will hopefully bring a return on your
original investment. Bonds, stocks, and mutual funds are investments that
you the investor can invest money. Bonds average a return of about 6%
yearly. Stocks for the long term have averaged 10% yearly and mutual funds
vary on what class you buy. The key word there is "return." A higher return
is better. More information on these investments is available at TeenProfiteer's
home: Teenprofiteer.com

Saving $1000 a month for a starting investor in his/her 20's seems a little
outrageous. If we cut that value in half and invest $500 monthly our ending
value when we retire on the beach will be more, though we saved less.

InvestmentInterest ** YearsRetirement
Bonds6% 40 995,000
Stocks10% (Average)40 3,162,000
Bank Account3% 40 460,000
With $500 monthly investment
* Value of money not considering inflation ** Return

Investing definitely pays off over the long run. This is where you, the
young teen investor, fits in. What separates you from a forty-year-old new
investor is that you have something more valuable then a regular salary,
TIME.

$500 invested at your 1st birthday, never touched, no money added and with
a 12% annual return will leave you with $400,000 at retirement of age 60. If
a person at age 40 invests $500 monthly for 20 years (A total of $120,000)
at 12% they will have a final value of $500,000 at age 60. It clearly shows
investing a few bucks early is a whole lot easier than waiting to invest
while you are older.

I hope today I have set your eyes on saving for your future. You know you
are going to have to do it someday. Now you are probably saying to yourself,
"How do I get started?" In the next articles we'll be going through all the
things you'll need to know and all the things you'll have to do. Until the
next articles, you can always visit our site at TeenProfiteer.com to get
other articles related to investing.

Average Grade: A