No Stupid Questions

Yes, and actually with low amounts of money to work with you can make your contributions very efficient. To best spend save for retirement, choose the first option from this list that applies to you (and if you are able to save more later, go down the list after exhausting each option):

• 401k up to maximum company match
• pay off high-interest (>4%) debt
• IRA up to the contribution limit
• investment-type HSA up to the limit
• max out 401k contribution
• personal investment account without tax advantage

For most people, it's recommended to use a traditional 401k and a Roth IRA, but it varies by situation. As for what to invest in, I would recommend a popular low cost ETF or index fund, like Vanguard or SPY. You can also look into ESGs if you want to do good with your money, but your expected earnings may be lower. I'm in ETHO and TICRX.

You might check out fire@lemmy.ml or personalfinance@lemmy.ml if you have questions about getting started.

The others have made great points about how any amount adds up. Especially with compounding.

But the most important reason me just be making it a habit. If you are saving $50/month you have a place to put your savings and an investment strategy for that money. The next time you get a pay raise or get rid of some recurring spend it will be natural to start saving $60/month, then $100 and more and more. It is much easier to improve an existing habit than starting a new one. So as soon as you have the chance start that got habit.

Compounding debts need to go first if their interest is higher than your savings.

Absolutely 100% yes yes yes.

Compounding is your friend. You can play with the values all you want, but this calculator showed me that if you deposited $50/month at 5%/year compounded annually, you'd end up making >$1800 in profit over ten years. Realistically, you should be able to get a better rate and shorter compounding periods once you've passed the threshold amount for a mutual fund or GIC.

And that's assuming you never increase your deposits.

Realistically, whenever you get a raise you should assign some of it to increasing your monthly payments. Your goal should be to increase your payments faster than inflation. Get a $2/hr raise? That'll probably add $250/month to your paycheque after taxes. You should be able to squirrel away $25/month from that at least.

Here's a great piece of advice from The Wealthy Barber (Canadian financial dude): Pay yourself first. See if you can get your investment amount taken directly off your pay, and then you'll never see it, thus be tempted to spend it.

His other advice is to set a goal of 10% of your income to invest for retirement. Seems like a lot, but it's doable for most people who are talking about investing anything, like you.

Remember: The biggest factor in how much you make from investments over time is how early you invest. Invest now. Invest regularly.

Yes. So much yes.

100% anything you can do is great.

My girlfriend and I have each been putting $50/month into an investment account instead of paying for insurance for our dog, that way if she ever needs a big procedure I can pull money from there if I don't have the savings for it. We've been doing this for 3.5 years and have now built up a good amount! I'll divide the numbers roughly in 2 so you can see what you could be looking at:

Total $2750.
Deposits $2200.
Gains $550.

Specifically if for retirement, time is your best friend. Anything you can put aside will be multiplied down the years and be much more when you need it most

Yes. Investing is always worth it unless you have credit card debit.

Set it up to automatically invest into the lowest fee index fund your broker offers.

It would be worth it with even $10. Do it.

Yes, in 35 years with compound interest that would end up between 35-85k ;) sounds great to me

That's 600/yr and a long enough horizon that most diverse portfolios are likely to be net positive (I'm seeing about 5,000 gained with 8% growth in a basic savings calculator)

I'd spend those 10 years trying to free up cash flow but time's a powerful weapon regardless

As much as I hate to send you to Reddit, the r/personalfinance flowchart is hard to beat for most people. I’d recommend you start there to make sure you’re not overlooking something like your emergency fund.

It's worth saving - investing (I assume you mean in the stock market/index/mutual fund) probably wouldn't yield very significant growth but it is worth saving what you can.

Yes. If you can afford it, dumping that money into an ETF like VT, VTI, or VOO every month for the next 10 years is very likely to result in you turning a profit. Start with a Roth IRA and don't bother with a standard brokerage account until you're able to max out the contribution limit. If you want to do anything more complicated than buy big low cost ETFs study up first and go slow.

Do you have emergency money?

First start emergency fund, then take care of debt. Then build a savings for emergency fund, then invest.

It's honestly probably better putting that amount of money into trying to get a better job over that time period via education, or taking time off to apply for new positions, or something similar.

$6000 total investment over 10 years even with decent interest on top would be made up in less than 2 years with a $5k raise.

Yes. I started with 50/month using Autopilot to get in on the Pelosi investment portfolio. I am up 18% for the year.