Lux Investing

What is the best way for low income families to invest their money?

Public Comments

1. Buy a color printer
2. saving and then either CD's or mutual funds. Reduce expenses as much as possible and innecesary expenses.
3. Honestly no one should invest money without speaking to professionals in the field. Seek out a good financial advisor. They will help a low income family not only come up with a workable budget but can also help you determine what is the best way to invest your money, and invest it safely.
4. invest in a 401k low mounthly investments overtime money builds up fast I promise you will not regret it in the long run
5. I can think of a few things where a low income family can get the most bang for their buck. 1) Formal education. Either college degree or learning a trade such as electrical work, plumbing or painting. Increasing the value of work you can provide an employer will likely have the biggest payoff for you over the long haul. 2) Reading. Go to the library to read personal finance magazines, such as Kiplingers, and check out and read a few personal finance books in order to help you better understand how to manage your finances. I recommend Andrew Tobias's "The Only Investment Guide You'll Ever Need" as a start. The Motley Fool has published some good investing books. Suze Orman isn't bad either. 3) Buy or piggyback onto someone else's discount club membership (Sam's Club or Costco). Buying in bulk can generate substantial savings that can then be reinvested into things such as education, books and financial investments.
6. First, don't consider investing if you have 1). debt (except mortgage), 2). no emergency fund (for those unexpected expenses), and 3). a mortgage. If you passed all these tests, and your emegrency fund has 6-9 months take home in it, speak to a Certified Financial Planner (CFP in the phone book) about where to put your money. Just be careful that they're not making money off what they suggest you invest in - they need to be totally independent of your investments. Save in this order - down payment on a house (if you don't already have one), your retirement, your kids college.
7. Getting an education is a great investment in yourself, and being cautious with your investments is wise, but don't ever let anyone tell you that low income families shouldn't invest in the same types of opportunities that anyone else could. People with very low incomes have made themselves into millionaires by a combination of responsible spending and thoughtful investing. The best place to start with small balances is mutual funds. As long as you stick with mainstream funds, you should be fairly safe. Don't expect a straight upward line, but over time, on average, you should expect the long-term results to be strong over the long run. Meanwhile, as you build up your portfolio, you can be reading and learning more about investing for the future. By the time you outgrow mutual funds, perhaps you will know more about the different stock market decisions you will need to make. Perhaps hiring a financial advisor would be wise at this point, or perhaps you can go on your own with your newly acquired knowledge. Consider books by Peter Lynch, Jeremy Siegel, and Benjamin Graham as some of the best sources. Best of luck to you.