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Did you know that half of all households have some form of investment in the stock market? Investments are a vital part of saving for retirement. However, if you’re a beginner you might feel too intimidated to start investing.
That’s why we made this guide. In it, we’ll go over some of the popular types of investment accounts you should consider as a novice. That way, you can start growing your money today.
Standard Brokerage Accounts
A standard brokerage account will provide you with a lot of different types of alternative investments. It allows you to deal with mutual funds, bonds, stocks, and more.
You can open either an individual brokerage account or a joint one if you have a spouse that wants to contribute too. The nice thing about these accounts is that you can contribute as much as you want each year.
Just remember that any interest or dividends you make on these accounts will be subject to taxes depending on how much money they make in a year.
Retirement accounts work in a lot of the same ways as a standard brokerage account when you start investing. A broker will invest the funds in a range of different areas.
The main difference is that the IRS often doesn’t tax any of the contributions, withdrawals, or investment gains you make on these accounts. There are many different retirement accounts out there.
The most common type you’re likely to see are traditional IRAs (individual retirement accounts) and ROTH IRAs. However, you also find employer-sponsored retirement accounts like a 401(k) plan.
These are great because your employer matches any money you put into it. Self-employed? Don’t worry, there are self-employed 401(k) plans that you can also invest in.
Precious Metal Accounts
In many cases, it can make sense to start investing in precious metals. These materials are becoming increasingly invaluable for industrial operations. So, it’s a fairly safe investment for beginners.
One way you can invest in precious metals is by opening an account that deals with exchange-traded funds. This won’t provide you with any physical commodity, but it’s a good way to trade liquid versions of the funds.
Or, you can buy bullions directly from a dealer like Sprott Money. Check them out here if you want to learn more about the type of metals they offer.
Enjoy Learning About the Types of Investment Accounts? Keep Reading
We hope this article helped you learn more about the different types of investment accounts available for beginners. The most important advice is to take things slowly at first.
Then, once you get into the swing of things you can begin investing money a little more freely. Did you love this topic? We have a hundred more just like it on our website. So, keep exploring to find more content you’ll love.