Before you begin investing you’ll want to make sure the basics of your finances are in order. Investing involves risk, so you’ll be better off if you can be sure you won’t need the money you’re investing for a long time – preferably five years or more. So, while the goal is to start immediately, you should tackle the following two financial issues first:
- Pay off high-interest debt. You should aggressively try to make payments on this to bring the balance down — because the interest you’ll pay will negate any gains you make on your investments.
- Build an emergency fund. Work on an emergency fund so that you have three months or more of living expenses in a savings account. You need to ensure you could survive financially if you lost your job or if an unexpected issue were to occur.
