Investing in College? What to Know

By Alicia Geigel on May 31, 2021

This article is brought to you by GradGuard. We protect college students and their families from the financial risks of college life, like providing a refund for tuition or replacing a stolen backpack when your school may not. When the unexpected happens, GradGuard’s tuition insurance and renters insurance can help you get back on track.

Nowadays there is a ton of buzz and interest in things like investing, cryptocurrency, and even the stock market as a whole. In general, so many Americans, especially college students, have fallen onto hard times and are looking for ways to make money both now and in the future. The coronavirus pandemic has significantly impacted both the workforce and college life, leaving many students without a means to work, save money, and learn at the same time.

Investing while in college can seem scary and intimidating, especially if you are already worried about your accruing debt. As a student, you might feel trapped in your financial abilities, limited funds, or student debt and think there is no financial freedom out there to make investments, but that isn’t the case! There are plenty of options out there for students to invest money and be financially secure in the long run.

Are you a college student looking to invest and gain some financial security? Here are five tips to help you get started!

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1. Create Financial Goals: The first step to accomplishing anything you put your mind to is establishing concrete goals. Once you create goals, you can put into action the necessary steps it takes to get to where you want to be. In terms of investing, it helps to set some short and long-term goals. Perhaps what works for you now is to invest little, but you’re looking to have larger investments in the future once you’re more established. Having these goals can give you a clear idea of what you need to do to accomplish your investment dreams, all while being a student in college!

2. Start Small: A short-term goal for investing your money can be to start small. How exactly do you start small, you ask? By setting aside money and investing little by little on smartphone investment apps. Apps make our general lives a lot easier, and believe it or not, can make our investing endeavors easier as well. For instance, a popular investment app, Acorn is targeted towards young investors. The app “counts whatever you spend from linked credit and debit card purchases, rounds it up to the nearest dollar, and invests the change in six different funds based on risk tolerance,” says Lou Carlozo of the Balance. Another great investment app is Betterment, which asks you simple questions like your age and your investment goals (for instance, retirement fund or wealth building) and then invests your money in different stocks and bonds.

3. Change Spending Habits: This tip seems obvious, but I think it’s one we all (including myself) need to hear. As college students, we like to spend money on frivolous things until we embody our stereotype of the broke college kid. Whether we’re going out to bars with friends on the weekends or buying takeout for the third night in a row, these seemingly small purchases add up. So, stop eating out and cut ties with your favorite coffee place, because all this is doing is putting a hole in your wallet. Instead of spending your money on things you definitely do not need at the moment, put it in a savings account or literally a piggy bank to keep you from spending. This little bit of money here and there will help you in the long run when you’re looking for a little bit of coin here and there to invest!

4. Scout Heavy for Employer Benefits: In today’s age, when social security benefits are under threat, adults both young and old need to take the proper steps to ensure they have a sufficient safety net and savings account(s) when it comes time to retire. As a college student seeking full-time, and potentially long term employment, it is important to really look deep into the benefits that your employer offers. Having a 401K that is provided by your employer is the best way to equally save and invest in your future, so when you are in your 60s or 70s, you can live comfortably and even invest some of your savings if your heart desires!

5. Educate Yourself: At the end of the day, nothing is better for investing than to simply educate yourself on the subject. Get to know the trends of your favorite companies within the stock market, familiarize yourself with financial terminology so the jargon is easier to understand, read a book or listen to a podcast from some of the best in the business world. A post by Great Performers Academy notes, “By reading through these sources of information, you can learn about various markets around the world such as the New York Stock Exchange and the Tokyo Stock Exchange. Reading also helps you to learn how to analyze assets before you invest in them.”

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While you may feel limited by your time in college or crippled by the amount of student debt you have, there are still simple ways to invest your money and obtain the greater financial freedom that we all desire. As a college student, you shouldn’t have to worry about protecting your finances, on top of other items in your life. Luckily, there are companies like Grad Guard that can help you protect your precious items like clothing, electronics, or jewelry, along with your tuition as well! Protecting and establishing your financial freedom doesn’t have to be hard while you’re in college, and if you follow just a few of these tips, you’ll be more in tune with the financial world-it will pay off in the future!

It’s no secret that college costs a lot of money. Make sure your investment in higher education is protected with GradGuard. Our affordable tuition insurance and renters insurance plans are specifically designed for college students. Customizable plans make it easy to protect your tuition, room and board, laptop, bike, and so much more.

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