5 Ways You Can Start Investing While In Your 20s Or As A Young Adult
As they say, success knows no age. This holds true too when it comes to investing. While you’re still in your 20s, you can already start considering investment options for your financial goals. In fact, the earlier you start investing, the better.
So, if you’re a young adult or around 20 years old, get started and check a few of our recommended investment options available in the Philippines.
1. Pag-ibig MP2 & SSS PESO Fund
Time and time again, we always recommend Pag-ibig MP2 and SSS PESO Fund. These are great investment options for beginners because they are hassle-free, low-cost, and have a higher dividend than banks. Plus, they are government-regulated, so your money is safe. However, remember that since these have a lock-in period, invest only the money you won’t be needing anytime soon.
2. High-yield savings account
A high-yield saving account is basically a savings account in a bank that gives higher dividends. These types of banks are not traditional brick-and-mortar banks. Many banks that offer high dividends are digital banks. These banks offer an annual interest rate of 3% to 4%, significantly higher than the traditional banks’ rates of less than 1%. This investment is great for your short-term goals and is ideal for building your emergency funds. It’s a liquid asset that you can easily withdraw, unlike Pag-ibig MP2. Examples of banks that offer high-yield savings accounts are:
- GCash CIMB
- Tonik Banks Stash
- Komo by EastWest
3. P2P Lending
In a nutshell, Peer to Peer (P2P) Lending is a form of crowd lending. Using a platform, you invest your money in “borrowers” to fund their businesses. Borrowers get easy loans, and in return, you, as a lender, earn higher interest rates. You can make an investment return of 10% or even higher, depending on the P2P lending platform and how much and how long you invested your money. Here are some P2P platforms in the Philippines:
- Lend PH
4. Start a small business
Starting a small business is also a great way to invest. If you have a day job, you can look for a side job that needs little capital that suits your lifestyle and skills. You can also look into products you can sell as a side hustle.
5. Invest in yourself
As Warren Buffett said, “The best investment you can make is an investment in yourself.” Investing in yourself also means investing in your dreams and goals. Enroll in classes and learn new skills. Personal development opens up many possibilities for your career and finances. It will broaden your perspective, make you more confident to take on new roles, and improve your overall well-being.
As a young adult, always remember that it’s never too early to start planning ahead. Consider which investment options suit your budget and lifestyle, and get started. Good luck!