With volatile markets, uncertainty over the war in Ukraine, and inflation concerns, millions of Americans continue to refrain from investing, preferring the relative safety of checking and savings accounts.
Five financial professionals offer their perspectives on the importance of investing despite volatile markets and share tips anyone can use to get started investing.
Begin Investing Now
If you start at age 22, investing $4178 each year could become a $1.1 million nest egg by age 67, based on historical market return assumptions and adjustments for inflation.
“Focus more on the amount you save than your investment selection,” says Jay Rishel, a New Bern, NC, Certified Financial Planner.
“Contribute to your investment account regularly and automate your investments. Time is your greatest advantage when it comes to investing so start as young as possible regardless of the amount,” Rishel says.
Take Advantage of Your 401(k) Matching Benefit
If you work for a company that offers a 401(k) plan, your employer usually matches a certain percentage of your contributions, essentially providing you with free money.
“You should always defer enough to receive those matching funds,” says Robert Henderson, a Groton, CT, Certified Financial Planner.
“Beyond that, open a Roth IRA and begin contributing enough to maximize your contribution limit each year. When you are young and in a (relatively) low tax bracket, the Roth IRA is a no-brainer.”