Investment products used by Eko are not FDIC insured, are not a deposit, are not obligations of, nor guaranteed by Lake City Bank and may involve risk including possible loss of principal. 

Key Takeaways

• • • • • Investing may not be as difficult as you think when you understand the basics.
        • Start with defining your investment goal and how much you can invest.
        • Make sure you understand risk and basic investment types.
        • Open an account to get started.

    ---

    Investing for the first time can feel confusing, or even a little scary. But if you take time to learn the basics, understand your goals and start small, you’ll be well on your way to building your portfolio.

    Investing can potentially help you grow your money, especially over a long period, because returns can compound. This means that your investment earnings can start earning their own returns over time.

    Follow along for simple steps to get started.

    Step 1: Determine your goal

    Why do you want to invest? Your goal will shape your investment choices. Maybe you’re saving for retirement, college, or a new home. Knowing your goal helps set your time horizon—how long you plan to keep your money invested. It also keeps you focused and motivated.

    Step 2: Calculate how much you can invest

    Look at your budget to decide how much you can afford to invest. You don’t need a lot to get started, even a small amount makes a difference because it gives your money time to grow. You don’t need a large amount to start. Some investment accounts let you buy fractional shares, so you can own part of a stock or mutual fund instead of paying for a whole share.

    A great starting point is Lake City Digital Investing, within Lake City Bank Digital. You can start investing with as little as $10, choose a portfolio style that fits your needs, and manage your investments all in one place.

    Step 3: Understand risk

    All investments involve some level of risk. Risk means you could lose money, make no returns, or even lose part of your original investment. The amount of risk you can handle depends on your timeline. If you’re young and saving for retirement, you can take more risk because you have time to recover if the market drops. If you’re saving for a short-term goal, like buying a house in a few years, you’ll want lower-risk investments.

    Step 4: Choose your investments

    Your next step is choosing investments. Choose investments that align with your goals and their time horizons. The basic types are listed below.

    • Stocks (or equities): These are shares of individual companies. Prices for a share of stock vary a lot—from single digits up to thousands of dollars. The price of a stock can go up and down, making it a riskier investment. You can buy stocks individually, but for the beginning investor, it’s more practical to buy stocks in mutual funds.
    • Bonds: When you buy a bond, you’re lending money to a company or government entity in exchange for regular interest payments. Bonds are considered lower risk because you know how much you’ll earn and when you’ll get paid, but they generally have lower potential returns than stocks.
    • Mutual funds: These are collections of different investments bundled together. Mutual funds spread out risk by combining many investments into one package, making them a more stable option than buying individual stocks. They’re also easier to manage since you don’t have to choose individual investments.
    • Index funds: A type of mutual fund designed to mimic a stock market index like the S&P 500. Since they mimic an existing index and are passively managed, they generally have lower fees compared to most individual stocks, bonds and actively managed mutual funds.

    Now that you know the basics, you can begin your investment journey. By starting small and learning as you go, you’ll build confidence along with your portfolio.

     

    Digital Investing is offered through Eko Investments, Inc. Eko’s “Investments as a Service” enables Lake City Bank to offer digital investments directly on our digital banking platform.  Investment products used by Eko are not FDIC insured, are not a deposit, are not obligations of, nor guaranteed by Lake City Bank and may involve risk including possible loss of principal.  Fees will apply. Click here to access Eko’s disclosures.