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system
how do i begin investment saving, rather than just saving in a bank account?
user
in general, the higher the return (such as interest), the higher the risk. if there were a high-return no-risk investment, enough people would buy it to drive the price up and make it a low-return no-risk investment. interest rates are low now, but so is inflation. they generally go up and down together. so, as a low risk (almost no-risk) investment, the savings account is not at all useless. there are relatively safe investments that will get a better return, but they will have a little more risk. one common way to spread the risk is to diversify. for example, put some of your money in a savings account, some in a bond mutual fund, and some in a stock index fund. a stock index fund such as spy has the benefit of very low overhead, in addition to spreading the risk among 500 large companies. mutual funds with a purchase or sale fee, or with a higher management fee do not perform any better, on average, and should generally be avoided. if you put a little money in different places regularly, you'll be fairly safe and are likely get a better return. (if you trade back and forth frequently, trying to outguess the market, you're likely to be worse off than the savings account.)
assistant