It’s great that your 26 and looking to save and or invest your money. Since you’re asking for advice, here’s my two cents worth: my advice for you is to be more aggressive at a young age and place your money in something other than a CD, or use a ratio to decide how much to place in conservative investments such as CDs, and how much to place in the market. For a young person, 75% aggressive and 25% conservative would probably be as conservative a ratio as I would go. The problem with CDs is that the money you place in one is barely outpacing inflation. Of course, the problem with stocks is that you could lose your money. If you diversify and choose wisely, you shouldn’t have to worry about losing alot in the stock market, and over your working life, you’ll probably get much better returns. Even if you begin investing just before a major market downturn, at 26, you’ll have years and years to make it up.
Pick up Benjamin Graham’s book, The Intelligent Investor and read chapters 8 and 20 first.
It’s only $12. Warren Buffet read it when he was just 19 and still thinks it’s the best book on investing ever written.
I wish I had first read that book at 26 instead of at 34.
Personally, my wife and I invest every dime we save by renting instead of owning.
