Investing your money, especially if you’ve never done it before, can be an intimidating thought. There are a huge amount of investment opportunities out there, and knowing where to put your hard-earned cash can be daunting. But it doesn’t have to be. Once you’ve read this guide, you’ll have a far better idea of why you should invest, and what to do first.Why should I invest?The main reason to invest is as a way to keep your money working for you, and bringing inconsistent returns, rather than languishing in a low-interest bank account. Investing isn’t a way to get rich quick. Instead, it’s a way to grow your money slowly and consistently. It’s that slow growth that almost guarantees results. After all, there’s a reason most of the richest people on earth know how to smartly invest their money. What this means for you is that your investments should be considered a long term game. Don’t put yourself into debt or take out payday loans in order to put extra money into your investments. Instead, pay in what you can, when you can. It’s better to pay in slowly and regularly and let the compound interest grow your pot over time. When should I start investing?Honestly, the best answer is yesterday, and the second-best answer is today. The earlier you start investing, the longer your money has to grow. Again, we’re going to point out the benefits of compound interest. Consider $1000, invested 10 years ago at a flat rate of 5%. You can see how a single sum grows over time. And this is without paying in anything extra. Imagine if you were paying in an equivalent sum every single year. That’s less than $100 dollars monthly, to end up with a total of almost $15,000 by the end of the ten year period. Now consider that the money you’re investing might also increase due to the growth of the investment vehicle you place it in. You might be worried about variations in markets and have heard horror stories of people losing their money. Don’t be. Historically, the stock market has earned a consistent return, year on year, of 10%. Any risk and volatility are reduced significantly the longer you invest your money. So again, start as early as you can. What should you invest in?When considering how to invest your money, there’s a lot of options available to you. The four most common, Retirement accounts, Stocks and Bonds, are detailed below. Retirement accountsIRAs are an excellent investment opportunity. Not only are they favorable when it comes to tax, but companies can also often give you beneficial plans to help you save. However, you are limited in how much you can pay in per year, and you might have restrictions on how and when you can withdraw funds. If in doubt when investing, starting with your retirement fund is often a good bet. They’re consistent, safe, and offer other beneficial terms, for example, tax breaks. A 401(k)Possibly the single best investment opportunity available to you. Having a 401(k) that is matched by your employer means that for every dollar you save, you’re effectively saving two. A Traditional IRAIRA’s like this are great because they might help you qualify for deductions on tax returns. There’s also the fact that your earnings are tax-deferred until you retire. This is important because when you retire, your lower income might put you in a lower tax bracket, which means you end up paying much less tax on what you’ve saved. If you’re a higher earner looking for retirement accounts, an IRA like this is a good option, but you should also consider…A Roth IRAA Roth IRA allows you to make contributions that are after-tax and allows your savings to grow whilst benefiting from being tax-free. Plus, withdrawals made when you retire are also tax-free. For most people looking for an investment account for retirement, a Roth IRA is the single best option and should be considered first. A Rollover IRAAs the name suggests, a rollover IRA is created when an existing account, like a company-sponsored 401(k) is no longer applicable, for example, if you move on to another company. StocksStocks are probably what most people think of when you mention investing money. Essentially, a stock is a percentage of a company. When you buy stocks, you’re buying chunks of that company, and as the companies value rises and falls, so too does the value of your stocks, proportional to how much you bought. This means, if the value of the company improves over time, your stocks will also become more valuable, meaning you can sell them on for profit. As part of a stock option, you might also be entitled to dividends, paid out to you based on how many stocks you own. It’s possible to trade in stocks by yourself, with a trading account, through a broker, or as part of a mutual fund. Mutual FundsMutual funds are investment accounts in which money is pooled by a number of people, (hence ‘mutual’) and that money is managed and invested by a professional, with returns spread amongst the group. Mutual funds are a solid starting option for investors, as they give you the option of a managed portfolio spread across a broad range of stocks and bonds, lessening the risks to you. Mutuals tend to be safer, because of this diversification, and they can be a much cheaper method of investment too, as you avoid the transaction fees you would have paid when investing in multiple stocks, instead only paying one fee, or sometimes not even that. Mutual funds are available from any brokerage account, but you can also find specific companies that trade solely in mutual funds. That’s the option we would recommend for first-time investors. BondsBonds are an excellent way to invest money with almost no risk to you. If you aren’t certain, bonds are debt security, which is used to raise capital for a huge variety of entities. Basically, you’re loaning money to the issuer of the bond for a fixed amount of time. They’ve been used by the Government, companies large and small, as well as local projects to raise consistent and safe income. When buying bonds, you tend to invest a fixed sum of money, with a fixed term and an interest rate that’s closely tied to the national interest rate. People choose to invest in bonds for several reasons. First, they’re much more predictable and much less volatile than stocks. Second, they’re fixed interest, with a guarantee of future payment. Third, because they’re tied to interest rates, bonds are independent of the stock market, and can sometimes defy the general market trends. Wherever you decide to invest your money, the best thing you can do is start today. It doesn’t matter how small your initial investments are, over time, and through the magic of compound interest, you’ll be able to watch your nest egg grow.