Xela Finance

Many young people don’t invest their money. They think they don’t have enough money to or it’s not worth it.

Well, here are a few reasons why you should consider investing, even if you are young. Time is crucial with investing. The more time you’ve been invested the wealthier you’ll be in the future. Here’s an example: say you start investing at age 20. You invest £500 which pays 8% a year for 30 years. At age 50 you’ll have £5,031.33

If you invested that £500 at the age of 30 instead of 20, that £500 would be worth £2,330 at age 50. So it goes to show how time can impact the result of the investment. Also these examples only use a one time payment of £500 which isn’t much. Believe it or not if you started with £500 and then invested £350 per month thereafter for 40 years at an 8% return. You will be a millionaire. Your investment will be worth £1,145,493.

Now, you’re probably thinking what do I put my money into to achieve this 8% a year. Well, there are two investments I like to use “iShares FTSE 250” (MIDD) and “iShares Core S&P 500” (IUSA) these two investments normally pay between 8 – 12% per annum.

Where can you find these investments? Most brokers will offer them, but personally, I use Trading212. If you want to set up an account with them use this link http://www.trading212.com/invite/4KBCADM and you’ll receive a free share up to £100. Anyway, now you don’t have an excuse by saying it’s not worth it or you don’t know how to invest.

The next reason people (not just young people) believe they can’t invest is because they think they need a lot of money to invest. The truth is you only need £1 to start investing. That’s it. So, as long as you own 100 pence, you can invest.

A common perception of investing is that it’s lot like gambling or it’s money you’re never going to see again. Unfortunately, the majority of young people nowadays would prefer to spend money on a brand new phone or wasting money on Starbucks weekly. When what you could do instead is change your perception and sacrifice a few of these habits to invest for the long term.