Am I Too Young for Life investments?

by Rachel Conway




It can be easy to think that you are too young to be worrying about making investments for the future. However, there are some distinct advantages in starting at a young age with certain types of investment. Some of them are discussed below.


Life Insurance


Life insurance will secure your family and any dependents by paying out a lump sum or a monthly income when you die. If you have no dependents then you may feel that it is unnecessary to do this. However, it is worth planning for the future with insurance. This is because as you get older the price will increase. If you get ill then it will be even higher. It is therefore worth considering buying a term life insurance when you are young, contrary to myths, so that there is some pay out for your dependents when you die at a later age. You may consider taking one out that will last until you are 70, for example as you may assume that your children will be independent by then or that you will have passed away before this age. You will need to consider what term will suit you but the older you are when it runs out, the dearer it will be, but the younger you are when you start the better.




A mortgage is a big commitment. You will need to be paying out every month for a long term and it may seem like something that you do not want to be tied down with. However, getting on the housing ladder at a young age is a sensible thing to do. You will find that you get a better price as property prices tend to rise all of the time. You will also have to start putting some money in to the house each month, which will be a good investment over time. Mortgage rates are also low at the moment and so it is worth taking advantage of that if you can.




It is always tempting to think that it is good to spend money while you can because once you are older and have more responsibility you will not be able to. However, it is much more sensible to save as much as you can when you have fewer expenses. You can use the savings towards a mortgage deposit or tuck them away for the future. You never know when you might need some extra money in the future and if you will not really miss it then it is wise to save it.




Many people do not like thinking about their pension when they are young. Putting money in to a pension does have some risk attached to it. You may die before you need it and if you have no partner or spouse to receive it then the money will be lost. However, if you start paying in when you are young, then you will have a nice retirement fund to live off when you are older. It will mean that you will not have to suffer financially when you are older. The sooner you start paying in, the more money you will accumulate and you will have a better retirement.



Investing money is something you should only do with money that you can afford to lose. It is more risky than savings as you could lose the money that you invest. With savings the sum is usually protected and you will get some interest. However, with investments you may lose the money, but the potential return is a lot bigger. Doing this when you are younger can be better as you will have less commitments and so able to risk the money and potentially make a nice sum for your future.

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This post was written by Rachel Conway

Rachel Conway is a staff editor at CCTS. She transferred from community college to Cornell University and enjoys helping students with this community college guide.

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