How Should I Start my Finance Life and Invest?
The best way to start out is to know that even the experts typically under-perform the market, so you have no chance.  Your best bet is to invest in diversified funds, either through something like Betterment or something like Vanguard's ETFs that track the markets.  Buying individual stocks isn't typically a winning strategy. I'd suggest looking at something like the Dummies series of books for this.   Something like: Sometimes the books are combined into one big book.  This would be the best bet.  It's were I started.  Every time I wondered something I just looked it up and learned. They are perfectly fine for the novice. Hope this helps.
"Your questions seek answers to specifics, but I feel that you may need more general help. There are two things, I feel, that you need to learn about in the general category of personal finance.  Your asking questions about investing, but it is not as important, IMHO, as how you manage your day-to-day operations.   For example, you should first learn to budget.  In personal finance often times ""living on a budget"" equates to poor, or low income.   That is hardly the case.  A budget is a plan on how to spend money.  It should be refreshed each and every month and your income should equal your expenses.  You might have in your budget a $1200 trip into the city to see a concert, hardly what a low income person should have in theirs. Secondly you need to be deliberate about debt management.  For some, they feel that having a car payment and having student loans are a necessary part of life and argue that paying them off is foolish as you can earn more from investments.  Others argue for zero debt.  I fall in the later.  Using and carrying a balance on high interest CCs and having high leases or car payments are just dumb.  They are also easy to wander into unless you are deliberate.   Third you need to prepare for emergencies.  Engineers still get laid off and hurt where they are unable to work.  They get sued.  Having the proper insurance and sufficient reserves in the bank help prevent debt. Now you can start looking into investments.   Start off slow and deliberate with investing.  Put some in your company 401K or open some mutual funds on the side.  You can read about them and talk with advisers, for free, at Fidelity and Vanguard.  Read books from the library. Most of all don't get caught up in too much hype.  Things like Forex, options, life insurance, gold/silver, are not investments.  They are tools for sales people to make fat commissions off the ignorant.      You are fortunate in that Engineers are very likely to retire wealthy.  They are part of the second largest demographic of first generation rich.  The first is small business owners.   To start out I would read Millionaire Next Door and Stop Acting Rich.  For a debt free approach to life, check out Financial Peace University (FPU) by Dave Ramsey (video course).  His lesson on insurance is excellent.   I am an engineer, and my wife a project manager we found FPU life changing and regretted not getting on board sooner.  Along these lines we have had some turmoil, recently, that became little more than an inconvenience because we were prepared." "This Stack Exchange site is a nice place to find answers and ask questions. Good start! Moving away from the recursive answer... Simply distilling personal finance down to ""I have money, I'll need money in the future, what do I do"", an easily digestible book with how-to, multi-step guidelines is ""I Will Teach You To Be Rich"". The author talks about setting up the accounts you should have, making sure all your bills are paid automatically, saving on the big things and tips to increase your take home pay. That link goes to a compilation page on the blog with many of the most fundamental articles. However, ""The World’s Easiest Guide To Understanding Retirement Accounts"" is a particularly key article. While all the information is on the free blog, the book is well organized and concise.  The Simple Dollar is a nice blog with frugal living tips, lifestyle assessments, financial thoughts and reader questions. The author also reviews about a book a week. Investing - hoping to get better returns than savings can provide while minimizing risk. This thread is an excellent list of books to learn about investing. I highly recommend ""The Bogleheads' Guide to Investing"" and ""The Only Investment Guide You'll Ever Need"". The world of investment vehicles is huge but it doesn't have to be complicated once you ignore all the fads and risky stuff. Index mutual funds are the place to start (and maybe end). Asset allocation and diversification are themes to guide you. The books on that list will teach you." The simplest way is to invest in a few ETFs, depending on your tolerance for risk; assuming you're very short-term risk tolerant you can invest almost all in a stock ETF like VOO or VTI.  Stock market ETFs return close to 10% (unadjusted) over long periods of time, which will out-earn almost any other option and are very easy for a non-finance person to invest in (You don't trade actively - you leave the money there for years).  If you want to hedge some of your risk, you can also invest in Bond funds, which tend to move up in stock market downturns - but if you're looking for the long term, you don't need to put much there. Otherwise, try to make sure you take advantage of tax breaks when you can - IRAs, 401Ks, etc.; most of those will have ETFs (whether Vanguard or similar) available to invest in.  Look for funds that have low expense ratios and are fairly diversified (ie, don't just invest in one small sector of the economy); as long as the economy continues to grow, the ETFs will grow. "Congratulations. The first savings goal should be an emergency fund.  Think of this not as an investment, but as insurance against life's woes.  They happen and having this kind of money earmarked allows one to invest without needing to withdraw at an inopportune time.   This should go into a ""high interest"" savings account or money market account.  Figure three to six months of expenses. The next goal should be retirement savings.  In the US this is typically done through 401K or if your company does not offer one, either a ROTH IRA or Traditional IRA.  The goal should be about 15% of your income.  You should favor a 401k match over just about anything else, and then a ROTH over that.   The key to transforming from a broke college student into a person with a real job, and disposable income, is a budget.  Otherwise you might just end up as a broke person with a real job (not fun).  Part of your budget should include savings, spending, and giving.  All three areas are the key to building wealth.   Once you have all of those taking care of the real fun begins.  That is you have an emergency fund, you are putting 15% to retirement, you are spending some on yourself, and giving to a charity of your choice.  Then you can dream some with any money left over (after expenses of course).   Do you want to retire early?  Invest more for retirement.  Looking to buy a home or own a bunch of rental property?  Start educating yourself and invest for that.   Are you passionate about a certain charity?  Give more and save some money to take time off in order to volunteer for that charity. All that and more can be yours.  Budgeting is a key concept, and the younger you start the easier it gets.   While the financiers will disagree with me, you cannot really invest if you are borrowing money.  Keep debt to zero or just on a primary residence.  I can tell you from personal experience that I did not started building wealth until I made a firm commitment to being out of debt. Buy cars for cash and never pay credit card interest.  Pay off student loans as soon as possible. For some reason the idea of giving to charity invokes rancor.  A cursory study of millionaires will indicate some surprising facts:  most of them are self made, most of them behave differently than pop culture, and among other things most of them are generous givers.  Building wealth is about behavior.  Giving to charity is part of that behavior.  Its my own theory that giving does almost no good for the recipient, but a great amount of good for the giver.   This may seem difficult to believe, but I ask that you try it." Alright so you have $12,000 and you want to know what to do with it. The main thing here is, you're new to investments. I suggest you don't do anything quick and start learning about the different kinds of investment options that can be available to you with returns you might appreciate.  The most important questions to ask yourself is what are your life goals? What kind of financial freedom do you want, and how important is this $12,000 dollars to you in achieving your life goals.  My best advice to you and to anyone else who is looking for a place to put their money in big or small amounts when they have earned this money not from an investment but hard work is to find a talented and professional financial advisor. You need to be educated on the options you have, and keep them in lines of what risks you are willing to take and how important that principal investment is to you. Investing your money is not easy at all, and novices tend to lose their money a lot. The same way you would ask a lawyer for law advice, its best to consult a financial planner for advice, or so they can invest that money for you. Congratulations on getting started in life! John Malloy's (American) research suggests that you should take some time to get used to living on your own, make some friends, and settle into your community.  During this time, you can build up an emergency fund.  If/when the stock markets do not seem to be in a bear market, you can follow user3771352's advice to buy stock ETFs. Do you hope to get married and have children in the next few years?  If so, you should budget time and money for activities where you make new friends (both men and women).  Malloy points out that many Americans meet their spouses through women's networks of friends. There are all sorts of topics in finance that take a lot of time to learn.  You have valuation (time value of money, capital asset pricing model, dividend discount model, etc.), financial statement analysis (ratio analysis, free cash flow &amp; discounted cash flow, etc.) , capital structure analysis(Modgliani &amp; Miller theories of capital structure, weighted average cost of capital, more CAPM, the likes), and portfolio management (asset allocation, security selection, integrates financial statement analysis + other fields like derivatives, fixed income, forex, and commodity markets) and all sorts.   My opinion of Investopedia is that there is a lot of wheat with the chaff.  I think articles/entries are just user-submitted and there are good gems in Investopedia but a lot of it only covers very basic concepts.  And you often don't know what you don't know, so you might come out with a weak understanding of something.    To begin, you need to understand TVM and why it works.  Time value of money is a critical concept of finance that I feel many people don't truly grasp and just understand you need some 'rate' to use for this formula.  Also, as a prereq, you should understand basics of accrual accounting (debits &amp; credits) and how the accounting system works.  Don't need to know things like asset retirement obligations, or anything fancy, just how accounting works and how things affect certain financial statements.  After that, I'd jump into CAPM and cost of capital.  Cost of capital is also a very misunderstood concept since schools often just give students the 'cost of capital' for math problems when in reality, it's not just an explicit number but more of a 'general feeling' in the environment.  Calculating cost of capital is actually often very tricky (market risk premium) and subjective, sometimes it's not (LIBOR based).    After that, you can build up on those basic concepts and start to do things like dividend discount models (basic theory underlying asset pricing models) and capital asset pricing models, which builds on the idea of cost of capital.    Then go into valuation.  Learn how to price equities, bonds, derivatives, etc.  For example, you have the dividend discount model with typical equities and perpetuities.  Fixed income has things like duration &amp; convexity to measure risk and analyze yield curves.  Derivatives, you have the Black-Scholes model and other 'derivatives' (heh) of that formula for calculating prices of options, futures, CDOs, etc.  Valuation is essentially taking the idea of TVM to the next logical step.  Then you can start delving into financial modelling.  Free cash flows, discounted cash flows, ratio analysis, pro forma projections.  Start small, use a structured problem that gives you some inputs and just do calculations.  Bonuses* would be ideas of capital structure (really not necessary for entry level positions) like the M&amp;M theorems on capital structure (debt vs equity), portfolio management (risk management, asset allocation, hedging, investment strategies like straddles, inverse floaters, etc), and knowledge of financial institutions and banking regulations (Basel accords, depository regulations, the Fed, etc.).    Once you gain an understanding of how this works, pick something out there and do a report on it.  Then you'll be left with a single 'word problem' that gives you nothing except a problem and tells you to find an answer.  You'll have to find all the inputs and give reasons why these inputs are sound and reasonable inputs for this analysis.    A big part that people don't understand about projections and analysis is that **inputs don't exist in plain sight**.  You have to make a lot of judgment calls when making these assumptions and it takes a lot of technical understanding to make a reasonable assumption--of which the results of your report highly depend on.  As a finance student, you get a taste for all of this.  I'm gonna say it's going to be hard to learn a lot of substantial info in 2 months, but I'm not exactly sure what big business expects out of their grunts.  You'll mostly be doing practical work like desk jockey business, data entry, and other labor-based jobs.  If you know what you're talking about, you can probably work up to something more specialized like underwriting or risk management or something else.   Source:  Finance degree but currently working towards starting a (finance related) company to draw on my programming background as well. I started my career over 10 years ago and I work in the financial sector. As a young person from a working class family with no rich uncles, I would prioritize my investments like this: It seems to be pretty popular on here to recommend trading individual stocks, granted you've read a book on it. I would thoroughly recommend against this, for a number of reasons. Odds are you will underestimate the risks you're taking, waste time at your job, stress yourself out, and fail to beat a passive index fund. It's seriously not worth it. Some additional out-of-the box ideas for building wealth: Self-serving bias is pervasive in the financial world so be careful about what others tell you about what they know (including me). Good luck. Borrow money and start a business.  Follow your business plan and invest in yourself and your entrepreneurship. If you mean invest in the market, do not borrow money.  In your plan, you are willing to make payments right?   There are lots of things you can do better, but borrowing money to invest in the market for a couple of years is not one of them.  Investing is boring, saving is boring, and planning your financial future is boring.  It takes a consistent effort and you aren't going to get rich quick. "The best advice I can give you is that you need to start on math *now*. I made the same mistake as OP and didn't realize that going up in finance would require as much math as it does. Granted, I was undergrad finance not marketing like him, so maybe it was a little better for me, but if you really want to do upper level finance do NOT skimp on math.  It's easy to fall into the trap doing cal 2 your sophomore year and thinking ""I won't really need this"" and just doing the minimum to get through it. For undergrad, that's true. For Master's you'll need it. This happened to me, and I suffered a LOT because of it. Your professors in the master's program will likely give you a crash course in what you need to know, but you won't have a real understanding of it unless you took (and did really well in) those math classes beforehand.  To answer your question,   1. Maybe. You should definitely take cal 1 early. Depending on how you can hold on to the information, cal 2 can wait a bit, so it's fresher when you start doing upper level finance your second half of junior year/senior year.  2. Upper level finance is a whole different beast from lower level finance. Same with economics. If you're not good at math, if you don't enjoy math, it might not be the best choice. I'm not good at math, and the undergrad finance wasn't too bad. However, the master's program was very very not fun.   EDIT: YMMV, but I don't recommend going straight into the master's program straight out of undergrad. Work (in industry!) for a bit first. The jobs you need to a master's for won't hire you straight out of undergrad, so it'll be dead weight. Experience is what you need." Put £50 away as often as possible, and once it's built up to £500, invest in a stockmarket ETF. Repeat until you retire. "There are many questions and good answers here regarding investment choices. The first decision you need to make is how involved do you intend to be in investment activity. If you plan to be actively investing by yourself, you should look for questions here about making investment choices. If you intend to be a more passive investor, look for posts by ""Bogleheads"", who focus on broad-focused, low cost investments. This is the optimal choice for many people. If you are not comfortable managing investments at all, you need to figure out how to find a competent and reasonably priced financial advisor to meet with and guide your investment strategy. This advice generally costs about 1-2% of your total managed assets annually." Many good sources on YouTube that you can find easily once you know what to look for.  Start following the stock market, present value / future value, annuities &amp; perpetuities, bonds, financial ratios, balance sheets and P&amp;L statements, ROI, ROA, ROE, cash flows, net present value and IRR, forecasting, Monte Carlo simulation (heavy on stats but useful in finance), the list goes on.  If you can find a cheap textbook, it'll help with the concepts.  Investopedia is sometimes useful in learning concepts but not really on application.  Khan Academy is a good YouTube channel.  The Intelligent Investor is a good foundational book for investing.  There are several good case studies on Harvard Business Review to practice with.  I've found that case studies are most helpful in learning how to apply concept and think outside the box.  Discover how you can apply it to aspects of your everyday life.  Finance is a great profession to pursue.  Good luck on your studies! It depends on whether you want a career as a fund manager/ analyst or if you want to be an investor/ trader. A fund manager will have many constraints that a private investor doesn’t have, as they are managing other people’s money.  If they do invest their own money as well they usually would invest it differently from how they invest the fund's money. Many would just get someone else to invest their money for them, just as a surgeon would get another surgeon to operate on a family member. My suggestion to you is to find a job you like doing and build up your savings. Whilst you are building up your savings read some books. You said you don’t know much about the financial markets, then learn about them. Get yourself a working knowledge about both fundamental and technical analysis. Work out which method of analysis (if not both) suits you best and you would like to know more about. As you read you will get a better idea if you prefer to be a long term investor or a short term trader or somewhere in-between or a combination of various methods. Now you will start to get an idea of what type of books and areas of analysis you would like to concentrate on. Once you have a better idea of what you would like to do and have gained some knowledge, then you can develop your investment/trading plan and start paper trading. Once you are happy with you plan and your paper trading you can start trading with a small account balance (not more than $10,000 and preferably under $5,000). No matter how well you did with paper trading you will always do worse with real money at first due to your emotions being in it now. So always start off small. If you want to become good at something it takes time and a lot of hard work. You can’t go from knowing nothing to making a million dollars per year without putting in the hard yards first. "You don't state a long term goal for your finances in your message, but I'm going to assume you want to retire early, and retire well. :-) any other ideas I'm missing out on? A fairly common way to reach financial independence is to build one or more passive income streams.  The money returned by stock investing (capital gains and dividends) is just one such type of stream.  Some others include owning rental properties, being a passive owner of a business, and producing goods that earn long-term royalties instead of just an immediate exchange of time & effort for cash.    Of these, rental property is probably one of the most well-known and easiest to learn about, so I'd suggest you start with that as a second type of investment if you feel you need to diversify from stock ownership.  Especially given your association with the military, it is likely there is a nearby supply of private housing that isn't too expensive (so easier to get started with) and has a high rental demand (so less risk in many ways.)   Also, with our continued current low rate environment, now is the time to lock-in long term mortgage rates.  Doing so will reap huge benefits as rates and rents will presumably rise from here (though that isn't guaranteed.) Regarding the idea of being a passive business owner, keep in mind that this doesn't necessarily mean starting a business yourself.  Instead, you might look to become a partner by investing money with an existing or startup business, or even buying an existing business or franchise.  Sometimes, perfectly good business can be transferred for surprisingly little down with the right deal structure. If you're creative in any way, producing goods to earn long-term royalties might be a useful path to go down.  Writing books, articles, etc. is just one example of this.  There are other opportunities depending on your interests and skill, but remember, the focus ought to be on passive royalties rather than trading time and effort for immediate money.  You only have so many hours in a year.  Would you rather spend 100 hours to earn $100 every year for 20 years, or have to spend 100 hours per year for 20 years to earn that same $100 every year? .... All that being said, while you're way ahead of the game for the average person of your age ($30k cash, $20k stocks, unknown TSP balance, low expenses,) I'm not sure I'd recommend trying to diversify quite yet. For one thing, I think you need to keep some amount of your $30k as cash to cover emergency situations.  Typically people would say 6 months living expenses for covering employment gaps, but as you are in the military I don't think it's as likely you'll lose your job!  So instead, I'd approach it as ""How much of this cash do I need over the next 5 years?""  That is, sum up $X for the car, $Y for fun & travel, $Z for emergencies, etc.  Keep that amount as cash for now. Beyond that, I'd put the balance in your brokerage and get it working hard for you now.  (I don't think an average of a 3% div yield is too hard to achieve even when picking a safe, conservative portfolio.  Though you do run the risk of capital losses if invested.)  Once your total portfolio (TSP + brokerage) is $100k* or more, then consider pulling the trigger on a second passive income stream by splitting off some of your brokerage balance.  Until then, keep learning what you can about stock investing and also start the learning process on additional streams.  Always keep an eye out for any opportunistic ways to kick additional streams off early if you can find a low cost entry.   (*) The $100k number is admittedly a rough guess pulled from the air.  I just think splitting your efforts and money prior to this will limit your opportunities to get a good start on any additional streams.  Yes, you could do it earlier, but probably only with increased risk (lower capital means less opportunities to pick from, lower knowledge levels -- both stock investing and property rental) also increase risk of making bad choices."