Is there a specific amount of money you must have in your account to open a mutual fund?

I am 21 years old and I have a lot of college debt. I want to learn more about how investing works. What is a good website for investing? How do mutual funds work and where do you open one? Is there a specific amount of money you must have in your account to begin the process?

Debt, Investing, Mutual Funds
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That depends entirely on the fund. Some do, but many do not as long as you establish a monthly contribution schedule of some sort.

 

What’s far more important, in my opinion, is to make sure you are not overpaying for those funds. 

 

Very carefully examine not only the up-front sales charges of these funds, But also their annual management and marketing fees. You do not have to pay them.

 

As a young person just getting started, overpaying for investments for your entire working life can literally sap hundreds of thousands of dollars away from your investment performance.

 

Also, just getting started, there is no need for you to find an actively managed fund to begin with. No research has proven that active fund managers can outperform the markets or their benchmarks for extended periods of time. So don’t pay their extra management fees.

 

Find a good, low-cost, quality index fund at a discount brokerage and begin there. Don’t try to get fancy and don’t try to be counterintuitive. Just get in. Time in the market is ultimately what matters. 

 

And may may I add, I’m very proud of you for getting started so young!

 

All my best. 

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