No matter what age you are, most financial experts recommend having an investment retirement account (IRA) as part of your financial portfolio. IRA's are a common recommendation for the first kind of investment you should make, and luckily for the new investor, they aren't overly complex investments to make. The most important thing to keep in mind is that the investment is designed for long-term benefit, so don't expect any quick profits.
Step 1
Decide how much money you want to invest into an IRA account. Roth IRAs don't allow more than $5,000 to be invested each year (as of 2009), so if you have more money to invest, you may want to consider a traditional IRA or a combination of the two. A Roth IRA will cost you less money in taxes in the long run because the initial investment is taxed and not the capital gains, while traditional IRAs are the opposite. Because you can earn more than you invest over time, a Roth is the ideal IRA, but it is not available to wealthy investors (you must make less than $166,000 if you are a family, $114,000 if single).
Step 2
Decide how you want to make that investment. You have two options: make lump-sum payments according to your own schedule, or have investment sums automatically withdrawn from your account each month. Automatic withdrawals can get you lower maintenance fees on the account and almost always reduce the amount of money you have to invest up front.
Step 3
Visit with financial representatives or bank representatives to discuss your options. Financial representatives work for investment firms and make commissions off the investment plans they sell to you, while many bank representatives do not get the benefit of commissions (though some do). Either of these groups can open an IRA for you, but they will have different fees and different restrictions, such as the minimum amount you can invest. Ask each representative whether he gets a commission off the IRA investment, and if so how much. Also ask what kind of account monitoring services each offers (online banking, etc.) so you can compare the services you'd like to have available.
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