Jake Doser, CFP®, CPWA® joins this week’s Money Wisdom Question Series to tackle a common question: How can I begin investing and grow my wealth?

Many people from various walks of life have different objectives, goals, and priorities. These vary depending on their stage of life. Consequently, different investments are appropriate for different folks.

Define Your Investment Goals

The first step in building your wealth and starting to invest is to clearly define what you are investing towards. Generally speaking, growing wealth is the overarching goal. However, specific objectives can be identified along the way, allowing you to be more precise with your plan.

Decide if you’re saving for retirement in general or for another purpose. If your goal is general retirement savings, the decision is straightforward. Utilize retirement accounts available to you, such as a 401(k), 403(b), 457, or IRA. If these aren’t available through your employer, consider an individual retirement account (IRA).

It’s crucial to consult with a financial advisor or accountant to determine whether you should opt for pre-tax, Roth, or a combination of both.

Specific Savings Goals

Maybe your goal isn’t general retirement savings. You might be saving to send your kids to college in 10 years, starting a new retirement account for yourself or your children, or preparing for your first home purchase. In such cases, a traditional retirement account might not be the best fit. Instead, consider non-qualified investments or a brokerage account. These accounts allow you to use similar types of investments but with fewer restrictions on pre-retirement usage.

Choose the Right Investment Vehicle

With numerous options available, consulting a professional is crucial. They can assist in creating a diversified portfolio tailored to your risk tolerance, goals, and timeline. Begin by determining whether you’re saving for general retirement or a specific, nearer-term goal. Once you’ve made this decision, you can choose the appropriate investment vehicle. Don’t navigate this journey alone.