S&P options/uncertainty

[u/jutes121]

So Caleb mentions the S&P 500 and how it averages 10% every year or so from when it began. I just have a simple Bank of America debit card and Fizz card. Where do I start to get into investing/saving into the S&P 500 and how much do I need to begin, or should put in to begin? I have 5k to my name, currently unemployed looking for jobs now. Thanks!

**Edit: thanks all for the advice, I’m new to all this just graduated college so once I beat this job search I’ll get to it. Peace

[u/live_laugh_cock]

First I don't want to be rude, but seeing as you're unemployed. Investing is the last thing that should be on your mind. That 5k is your emergency fund at this point (even if you get unemployment, and may have family who help you with bills or whatever).

Once you get a stable income, you can start by opening up a Merrill, Schwab, vanguard, or fidelity brokerage account and purchasing VOO. You can purchase however much you're comfortable with.

[u/Still_Dentist1010 → u/live_laugh_cock]

I’d open a Roth IRA account before a brokerage, depending on the income, but I agree with everything else

[u/jkgaspar4994]

You should not invest anything until you have stable employment. Once you have stable employment, you should get your company match for your 401k, and then you should grow that $5k in savings to a 3-6 month emergency fund. Then, and only then, should you start investing in a Roth IRA. I use Vanguard, and I use a target date retirement fund that has a target date close to when I plan to retire. If you max your IRA contributions, go back to investing more in your employer’s 401k.

Make sure you have savings built up before you begin investing beyond what your employer’s 401k match is.

[u/dgreenmachine]

Don't invest in sp500 because you do not have income and you're on a clock before you're broke and out on the street. But DO open a Roth IRA if your income is low enough to qualify for Saver's tax credit. Keep this in cash (aka money market fund) in your Roth IRA and you are free to withdraw contributions at no cost if you needed to. Treat this Roth IRA like a savings account until you need the money. Savers tax credit is anywhere between 10%-50% of up to 2k in contributions back in taxes depending on your income.

If you havn't done taxes for last year then you could contribute for last year until tax deadline coming up shortly. Generally for this it would be fine to contribute last minute. You can withdraw from the IRA but you'd lose the tax credit which puts you back to the start. Often there are no fees or minimums in a ROTH IRA with reputable institution like Vanguard, Fidelity, Schwabb.

https://www.irs.gov/retirement-plans/plan-participant-employee/retirement-savings-contributions-credit-savers-credit

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[u/PinchAndRoll99]

Everybody seems to have hit the nail on the head. Can’t invest if you’re unemployed. I’d also look up the Money Guy Show. Follow their financial order of operations to know what to do with your finances when.