Don’t Avoid Investing Because of a Fear of Risk

Budgeting, saving, and relying on your employer to give you the raises and bonuses you deserve will only get you so far because you’re ultimately working with fixed amounts of money. Sure, you can rely on compound interest to stretch your dollars further, but you should look for ways to gain more as well.

However, many Americans don’t even consider investing as a source of income, mainly because of the risk. That’s why we and every trustworthy financial advisor under the sun will tell you to only invest what you’re comfortable losing. That way, you won’t dig yourself into a hole if things don’t go to plan.

Your investment strategy matters too. Typically, those who are in their 20s and 30s should look into stock mutual funds. As you grow older you should start paying more attention to bond funds and stock to lower your risk.