Money tips

emergency fund because your primary goal for that money is accessibility, not growth. The stock market goes up and down, and there’s a real risk that it could go down just when you need the money. At best, that could mean having to sell your investments at a loss to pull cash out. At worst, it could mean your money won’t be there when you need it most.

If you haven’t ventured into the world of investing yet, it may feel like a scary time to start given all the volatility in the market. The good news is that volatility doesn’t cause much harm when you’re in

vesting for a long-term goal like retirement: The peaks and valleys due to the coronavirus will likely appear much smaller over time.

If you haven’t started investing, there are two easy jumpingoff points: your employer’s 401(k) if it offers one and an IRA. Both are accounts that can help you invest for retirement with some tax benefits. Roth IRAS, for instance, allow your money to grow and be taken out in retirement tax-free.

Even if you’re already contributing to a 401(k) or an IRA, you may want to consider upping that contribution. Every extra bit you can put toward retirement goes a long way. Let’s say your reduced expenses mean you can save an extra $500 a month over the next year. If you have 30 years until retirement and you earn a 6% return, that $6,000 you invest could add

over $34,000 to your retirement balance — a significant boost.

Retirement is a common goal, but it likely isn’t the only one you have. If you’re on track for retirement, consider putting extra funds toward other things: college for your kids, a new car or a dream vacation.

Investing can help you achieve those goals faster than just saving, but keep in mind that you generally don’t want to invest money you’ll need within five years. (Savings for near-term goals should go into safer options, like a high-yield savings account). On the other hand, if you’re starting a college fund for a newborn, that money will have approximately 18 years to take advantage of the market’s returns.

If you’ve found yourself in a position

of privilege during this global pandemic and have been able to save some extra money, you may also want to consider increasing your charitable contributions.

If you’re interested in investing in real estate, you don’t have to start renovating an old barn. One of the easiest ways to invest in real estate is to invest in real estate investment trusts. REITS are companies that own (and sometimes operate) real estate that generates income, such as apartment buildings. Publicly traded REITS are bought and sold on exchanges, just like stocks, and have similar liquidity, meaning you can sell them with relative ease.

When you suddenly find yourself with extra money, it can be difficult to figure out the best way to put it to use. Financial advice is widely available, and it’s often inexpensive. Online financial advisers and robo-advisers have brought the cost of investment management and financial planning down significantly, and both are good options for when you’re feeling lost.

These advisers can also help you stay hands-off with your portfolio during turbulent times in the market by ensuring that your investments are aligned with your risk tolerance. Robo-advisers offer investment management and typically charge between 0.25% and 0.50% of your assets per year. If you need assistance developing a more comprehensive financial plan in addition to investment management, it may be a good idea to enlist the help of a financial adviser.