3 steps for veterans to prepare for investing

"When I retired from the military, I didn’t know what to do with my retirement pay and new income from my job. I went to a financial advisor's website and they wanted me to open a brokerage account. I wasn’t sure what that was, so I went out and bought a boat." - Retired Army Officer

Fortune favors the prepared mind. A brokerage account may sound intimidating, but it doesn’t have to be. It’s simply an account you use to invest, which people do every day with apps on their phones. Before you jump right in though, you’ll want to make sure you do a few things to prepare.

1. Create a budget and build an emergency fund

Failing to plan is planning to fail. Think of achieving financial readiness in the way you might prep for a mission, so you’re equipped to handle challenges that come your way. You don’t want to invest money that you need today or might need tomorrow.

As a starting point, you might first lock in your budget. Figure out your monthly income and expenses (rent or mortgage, bills, groceries, etc.), then from there determine what you may have left over.

You could use this excess to begin putting aside money for an emergency fund that covers 3-6 months of your living expenses. This can possibly provide a valuable safety net for unanticipated financial situations that will inevitably arise!

Read more: 3 ways to find money to invest

2. Establish goals, timeline, and risk tolerance

Chart your financial course post service. The transition to civilian life may come with some changes like a new job, moving, or potentially going back to school. Think about what you’re investing for and when you plan to use the money. Are you looking to buy a house in the near future? Or, maybe your goal is to put money away for a child’s college fund?

Your objectives and timeline influence the types of investments you choose, as well as how much risk you are willing to take. For example, if you don’t expect to need the money for many years, you may be more comfortable with a higher level of risk since your investments could have more time to recover if they dip in value.

Read more: How to invest for a big goal

3. Learn the basics

Education is a first line of defense. As veterans are well aware, continuous learning is key to staying sharp, adaptable, and ready for whatever life throws at you. Getting started with investing can be easy if you take just a bit of time to read up on a few things.

Are you familiar with what stocks and funds are? That’s a good place to begin. So is understanding the importance of diversification—spreading out your money across different investments to reduce risk.

Educating yourself about basic investing strategies is also beneficial. Concepts like dollar-cost averaging (investing the same amount regularly over a period of time) may help you avoid worrying about when to buy and sell.

Read more: Time in the market vs timing the market

Try Plynk!

Plynk is an investing app designed to uncomplicate the complicated. You can open a brokerage account in a few simple steps and get going in a welcoming and unintimidating environment. The app offers investing education to build your confidence as you go, with tools like:

• Plynk Explore - choose investment ideas by answering 3 simple questions
• Virtual portfolios - see how combinations of investments have performed historically
• Watchlists - monitor stocks and funds you may be interested in

You can kick off your investing journey with Plynk with as little as $1.

Download it now.