Between paying off student loan debt and launching a career, most 20-somethings don’t place investing as a top financial priority. But while this practice may seem reserved for older generations, financial advisors note that starting as early as possible can help deliver better results. Specifically, the more time you have to build investments, the more time there will be for growth potential. If you’re interested in building sustainable wealth for the decades ahead, here are a few practical ways you can invest as a young adult.

3 Tips for Investing In Your 20s  

1. Maximize Employer 401(k) Benefits

Whenever you start a new job, find out if your employer offers retirement benefits. Usually, this is set up through a 401(k) account. If you contribute to this account directly from your paycheck, the portion will be collected from your income pretax. Your 401(k) will stay with you until you retire—even if you change jobs—allowing for the potential of tax-deferred gains throughout your entire professional life.

Many companies also match 401(k) contributions up to a certain amount. If you want to take advantage of this extra money, be sure to max out your retirement deductions on each paycheck.

2. Pump Up Your Portfolio  

In the short term, some investments in the stock market can carry substantial risk due to unpredictable market swings. Although past performance doesn’t guarantee future results, historically speaking, if you hold stocks in your portfolio for several decades, you can generally expect the overall value to increase, making the practice a wise long-term investment.

Ask your financial advisor about which products are appropriate based on your situation.

3. Buy a House

With a little planning, you can save up a sizable down payment for a house and cover the rest of the purchase with a mortgage. In many cases, the mortgage payments will be lower than what you’d pay in rent, which in turn, can help you save money over time.

Your first home doesn’t need to be anything extreme. A small single-family property, for instance, can give you the independence of being a homeowner, while allowing you to build your creditworthiness for future real estate purchases. Once you pay off the home loan, you can hopefully sell the property for a higher return or rent it out to generate passive income.

Becoming a smart investor takes time and experience. With help from Family Financial Partners in Lexington, KY, you can jumpstart this process. Helping clients of all ages and backgrounds, these financial advisors will help you craft an investment strategy that fits your level of risk and goals. Apart from serving as your investment planner, this firm can also help you establish financial security through their retirement, life insurance, and estate planning services. Estate planning services are provided in conjunction with your licensed legal advisor. For more details on these services, visit this team of financial planners online or call (859) 219-1006.