Comment on Is it worth investing if I can only contribute $50 a month?
474D@lemmy.world 1 day ago
I just put extra money in a 5% high yield savings account. It’s not exciting, but there’s no risk and it will pay off over time
Comment on Is it worth investing if I can only contribute $50 a month?
474D@lemmy.world 1 day ago
I just put extra money in a 5% high yield savings account. It’s not exciting, but there’s no risk and it will pay off over time
subtext@lemmy.world 1 day ago
There’s also hardly any reward (comparatively speaking). Yields are crazy high right now on savings accounts, but they’re going to continue to drop, vs investing in the stock market (over the long term) is much more likely to maintain a much higher rate of return. Even at 5%, you’re really only getting about 2% growth since inflation is stuck at 3% right now. That compares to a long term average in the stock market of 7-9% after inflation.
Not to say that OP should do that, necessarily. Especially if they haven’t built their emergency fund which is far more important than investing, until you have a safe amount.
474D@lemmy.world 16 hours ago
You’re probably right, as I’m not an expert, so thanks for your input. I am still worried of how the stock market will change with the upcoming trainwreck
subtext@lemmy.world 16 hours ago
You gotta remember the time horizon, even with historically bad presidents in office, if you smooth the line of the stock market returns over 10, 20, or 30 years, it ends up looking like a really, really good as an investment opportunity. Especially if you’re into dollar cost averaging.
Basically, if Trump tanks the stock market by going way overboard with things like tariffs, that would (at least looking at historical trends, I’m no financial expert or anything) make for a killer time to buy into the stock market because you’re getting stocks at a “discount.” Then when a different president / legislature comes into office, and if they turn around the economy, your investment would rise faster than otherwise expected.
Again, you gotta do what’s right for you, this isn’t me saying you should absolutely invest or anything, especially if your basic needs aren’t met or your emergency savings aren’t at a good enough level to last 6–12 months unemployed. This is just how it has been for the last ~100 years.