What Is The Best Investment When You’re 18 Years Old
When you are 18 years old the world is an open book. You think you know it all but there is so much to learn and you’ll soon find out, sometimes the hard way.
I was a punk at 18 and made some awful choices. Luckily those choices weren’t too damaging and I turned out alright (I think?). What I wish I would have had at 18 is someone to give me guidance on what I should invest in.
Don’t get me wrong, my parents did a great job raising me. They were supportive but also laid down the law when I need some course correction.
Now, when I say what I should invest in I’m not talking about specific stocks or mutual funds. I can’t tell the future and I’m not going to pretend like I can in this post and name specific companies.
What I mean by invest is where you should invest your money and time. This article is geared towards money specifically.
What Is The Best Investment For An 18-Year-Old
- Invest in what works like a Roth IRA or Traditional IRA.
- Invest in your education. (Including more than just college.)
- Invest in your people skills, selling is a great approach to this.
- Continue to invest in learning, you’ll be learning your whole life.
I honestly believe if I could go back and read this article when I was 18, I would have made some significant changes. Again, no regrets. But I do realize there are so many opportunities that are out there, most different from what I did. No matter your situation, if you have self-motivation coupled with the convenience of the internet, there’s no excuse good enough to keep you from succeeding.
Start With What Works
The first thing you should know about investing as an 18 year old is pretty easy. Do what works.
Seems logical right?
That is why I suggest if you have a handle on your finance basics, you should open some sort of investment account as soon as possible. When you turn 18, you get the ability to open up any sort of investment account you want. Most take this opportunity to jump on Robinhood and start day-trading stocks.
While this may not be a bad idea for some of you, for most it just isn’t the best approach. It’s a little too risky and takes day-to-day effort.
You don’t care about individual stocks or trading. You just care about making your money grow.
That is why I suggest most people look into a Roth IRA. I suggest most people open a Roth IRA on either Wealthfront or Vanguard. Showing people how to do this step by step is one of the modules in my course Money Made Easy.
I also often reference the chart below. If you want to read all about it then check out my article going over how the longer you invest, the more money you will have. You can read the chart and we already know you’re smart so you can see the result.
By investing early and often, you are setting yourself up to have a huge nest egg in the future. Consistent Claire will have over $1,000,000 in her account while the others will have less than 50% of that.
Which do you want to be?
Do what proves itself over and over again and start investing now.
Don’t Follow The Crowd
One of the most frustrating trends I see happening is people following the crowd. You don’t need to go to the same state school as your high school best friend. Especially when you have no idea what you want to do or have interests elsewhere.
Trust me, I get it. When you are 18 years old, you think that you will have these friends for life. My best friends in high school are still some of my best friends today. But there are so many people that I have met post-high school that changed my life for the better.
My point is you need to make the best decision for yourself and not the decision that keeps your friend group together. If they’re really your friends, a change in scenery won’t disrupt that.
Love cars? Go to mechanic school.
Want to work with computers and coding? Go to an online school that is 1 year instead of 4.
Going to a university that you have no interest in and putting yourself into thousands of dollars of debt makes no sense. Luckily, this concept is becoming more mainstream and people are waking up. To be honest, I blame high school administrators for pushing on kids that if they don’t go to college then they are a failure.
You are reading this article so you are obviously smart and you realize that you have so many more options than just the traditional route of going to a 4-year university. Explore them! And don’t worry about how it looks. It will be so worth it in the end.
This advice isn’t going to be for everyone but for some of you it has the potential to be helpful.
Go sell something. It is an investment in your people skills. A skill that I think is essential to most people’s success.
I don’t care if it’s jewelry on Etsy, an online course like Money Made Easy, or your time trimming trees. Personally selling something will teach you more than you know.
Asking people to trade you their hard-earned money for something you offer will teach you how to communicate with others. It is one of the most awkward situations you can possibly put yourself in, at least for me, and by doing it you will gain a priceless amount of confidence.
Your first sales pitch, copywriting, and product will be awful. When I wrote my first book 3 years ago I was proud of it (still am) but looking back, it isn’t my best work.
But that’s the point.
I made over $500 selling and self-publishing my first book. Most of these sales were talking to people face-to-face. Those conversations taught me skills that I can use in other areas of my life.
If I were to go into a job interview, talk at a conference, or go on a podcast (check out my Wichita Life ICT episode), then I would feel 100x more confident in myself because I purposely put myself in those situations in the past. Practice and repetition make everything easier, even in this case.
People skills innervate every part of your life and most of us don’t naturally have them. Especially when you are 18 years old. They are a skill you need to learn and it requires some sort of investment.
Who knows, you may be able to put those people skills to work someday when talking to a person you find attractive. Just ask my girlfriend.
Invest In Learning
When you are 18 years old and graduate high school, you think you know it all. You are on top of the world and you are about to have more freedom than you have ever had before. You’ll get this same feeling when you finish any other schooling after high school. Then again when you turn 25.
This process will happen over and over.
While you are getting wiser (hopefully), one thing won’t change.
You don’t know much and there are still many more things to learn. One of the best investments I personally believe you can make when you are 18 years old is learning. Taking a step back and understanding there is always more to learn and it is something you will do for the rest of your life. And trying to remember that you don’t know it all, even if you feel like you do.
Because of this philosophy, I personally don’t believe in anyone being an expert. Our world moves incredibly fast and new discoveries are being made every day. Are there people that know a whole lot about a certain topic?
But there is always more to learn on any topic.
The best investment you can make when you are 18 years old is in continuous learning. Read a book, watch YouTube videos, talk to interesting people, take a short online course. Do these things for topics that interest you then do it more and more.
Zach over at Four Pillar Freedom wrote about what he would tell himself at 18 (he’s now 26) and most of them have a common theme of revolving around learning. It’s a quick read check it out if you have a spare minute: Things I’d Tell Myself at 18 That I Now Know at 26.
Learning will never stop and it will always add value to your life.
The Bottom Line
When you’re 18 years old, the world is your oyster. You get to decide for the first time what the next phase of your life will look like. While you should be responsible, you also won’t feel happy or fulfilled if you don’t do anything that interests you.
Talk to the adults in your life that have done it already.
If you think a job or degree looks cool, reach out to someone who is in that field. Trust me when I say that the majority of people love to talk about themselves.
Take hold of your finances so that you don’t have to stress about it every day. Experience and explore as many things as you can to figure out what you like. Never stop seeking out the opportunity to learn, it keeps you young. And don’t forget to enjoy yourself.
No matter what you decide to do, you’re only 18 once and it can be an awesome, exciting time. This is your big leap into adulthood and it will be what you make it.
You’re in charge.
If you liked this post then please share by hitting the icons above and if you want to read more articles here are my latest:
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