Student Investor (bonds, IRA, mutual funds, trading)

[RMcFadden2012]

Hello all! I'm a 20 year old college student looking to start investing with some extra money. I'll start with some information about my finances: I currently have no debt, and will not incur any student loans due to full academic scholarship to my school. Last year, I put $500 into a traditional IRA and I currently have $5,000 in a high-yield savings account, adding $50 each month. I also have $10,000 in savings bonds that my parents gave me that I'm just leaving alone so they can accrue interest.

This year, I'd like to use the $500 that I get back on my tax return to start investing. I've looked into a few possibilities: DRIP accounts, mutual funds, index funds, individual stocks (with the idea of buying and holding), and opening a Roth IRA. To be honest, I'm a little overwhelmed by all of the options and am not sure which is the best option for me. Any input would be greatly appreciated! Thank you.

[BigCityDreamer]

Originally Posted by RMcFadden2012

Hello all! I'm a 20 year old college student looking to start investing with some extra money. I'll start with some information about my finances: I currently have no debt, and will not incur any student loans due to full academic scholarship to my school. Last year, I put $500 into a traditional IRA and I currently have $5,000 in a high-yield savings account, adding $50 each month. I also have $10,000 in savings bonds that my parents gave me that I'm just leaving alone so they can accrue interest.

This year, I'd like to use the $500 that I get back on my tax return to start investing. I've looked into a few possibilities: DRIP accounts, mutual funds, index funds, individual stocks (with the idea of buying and holding), and opening a Roth IRA. To be honest, I'm a little overwhelmed by all of the options and am not sure which is the best option for me. Any input would be greatly appreciated! Thank you.

I would simply put my money in an ETF that tracks the S&P 500 and ride it for a few years.

That's how I got a "feel" for the stock market when I first began investing. Continue to learn more about investing and trading as you go along.

[bmw335xi]

Since $500 is not a lot, you should go with an ETF such as VTI which tracks the total stock market, you could go with something like DIA as well, which tracks the Dow 30 or IVV, which tracks the S&P 500 or QQQ, which tracks the Nasdaq 100. The less risky of these in my opinion would be VTI, but all of them are much safer than investing in an individual stock and a much better idea than investing in a mutual fund.