How to invest when you’re at university

It’s getting ever harder for students to plan for financial freedom. Here’s how to invest at university and build money for the future.

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University is a time for socialising, living independently and, most importantly, learning skills that you need to develop your future career. However, your time at university also gives you a great opportunity to delve into the world of finance and introduce yourself to the stock markets. In fact, your university years could be the perfect time to start building your investment portfolio. Here’s everything you need to know about how to invest at university. 

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Investing as a university student: best practices

University students are increasingly interested in building their wealth, saving the money they earn and making investments. The job market is becoming increasingly competitive, which makes it more important than ever for university students to have their finances in check before they complete their education.

As a result, many are looking to invest to build wealth as early as possible. With that in mind, here are some tips for investing your money as a university student.

Invest little and often

It’s likely you don’t have large amounts of cash at your disposal. After all, the minimum wage currently sits at just £6.56 if you’re aged 18-20 and £8.36 if you’re 21-22. If you’re over 22, the minimum wage is still just £8.91. So, even if you qualify for the highest rate, it’s no doubt difficult to build up savings.

With lectures and assignments taking up so much time, it can be difficult to earn a significant wage as a student. Therefore, instead of investing large sums of cash at one time, aim to invest little and often.

Many ISAs and savings accounts allow you to deposit small amounts of money each month. In fact, some expect contributions of as little as £1! This would be a great way to build up your savings and investments and make a habit of investing your money regularly.

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Take advantage of handouts

You may qualify for additional grants or scholarships on top of your regular student loans. Of course, this money should be used to ensure that you can afford to study at university. However, there is no harm in putting any extra cash into your portfolio.

Alternatively, you could make the most of handouts from family and put any extra money that you can into your investments. This may mean living frugally for a short while. However, putting your money into long-term investments is a great way to secure your finances for the future.

Open a stocks and shares ISA

As a university student, you have a lot on your plate! As a result, taking time to learn about the stock market and make informed investment decisions is often off the table. If you’re too busy to learn about the stock market, it may be worth investing in a ready-made stocks and shares ISA.

These investment accounts put your money into a portfolio that is built by market experts to offer the best returns. You’re free to choose what type of stocks and shares ISA you invest in, your desired risk level and how dividends are paid.

Taking advantage of stocks and shares ISAs is a fantastic way to get into the world of investing if you don’t have time to learn about the market.

Invest for the long term

If securing wealth for the future is your investment goal, you should consider long-term investing. Long-term investing is the process of choosing investments you plan to hold in your portfolio for the foreseeable future. These could be companies that you expect to do well in the long run.

Long-term investing often comes with a much lower risk than shorter-term investment strategies. Furthermore, investing for the long term allows you to sit back and let your money grow instead of regularly adjusting your portfolio. This is a great strategy if you may not have the time to constantly monitor short-term investments.

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