"I am not financially literate at all and I don't know what accounts to open or what to do to put my money somewhere where I can keep growing it.": I want to be financially independent by graduation. How can I invest my savings wisely with little time and no hidden fees?

Hi Money Minder, I just turned 18 and have around $4,000 saved in my personal account. My parents and I have saved $60,000 for college over the years, and with a scholarship, I’ll have about $20,000 in debt when I graduate.

I am really grateful for this opportunity, but I want to save more money so I can be independent. I don’t know much about finance and I’m not sure where to put my money to make it grow.

Can you help me out? I plan on doing work study and have two side hustles for extra income, so I’m not interested in stocks. I don’t have time to follow the market and I want to avoid hidden fees. Thank you!

Curious Saver

Response from THE MONEY MINDER:

Hello There,

Firstly, congratulations on reaching this significant milestone of turning 18, and it’s impressive that you have saved up $4,000 in your personal account. It’s understandable that you want to become more financially independent and ensure your financial security in the future. It’s great to hear that you are motivated to grow your money wisely.

Given your circumstances, a good starting point would be to open a high-yield savings account. This type of account offers higher interest rates compared to traditional savings accounts, allowing your money to grow over time. It’s a safe and low-maintenance option that doesn’t require you to actively manage investments in the stock market.

Additionally, you may want to consider opening a Certificate of Deposit (CD) account. CDs offer higher interest rates than regular savings accounts and are a safe way to grow your money over a set period. Just keep in mind that with a CD, your money will be locked in for a specific duration, so only invest funds you don’t need immediate access to.

As for your side hustles and work-study income, consider setting up automatic transfers from your checking account to your savings account after each paycheck. This way, you can consistently save a portion of your earnings without having to actively remember to do so. It’s a good way to build up your savings over time.

Remember that financial literacy is a journey, and it’s okay to seek guidance along the way. Consider speaking to a financial advisor who can provide tailored advice based on your specific goals and situation.

All the best from THE MONEY MINDER as you take steps towards building a secure financial future for yourself.