Know All the Avenues for Investment When you Start

When it comes to finances it's so important to diversify. That's true for types of income and investments.

Having multiple income streams doesn't have to be as a result of side hustles or real estate (although I'm a big fan of those). It could be as a result of some of my favorite passive income, dividends and interest. There's nothing quite like waking up to that dividend deposit knowing your money is working for you.

But even within your investments you need to keep them diverse. Diverse in types of tax advantaged accounts (ex. Have a tax free Roth IRA and a tax deferred 401K). If you're investing in stocks, keep them varied. Hold many different companies in different sectors.

My favorite easy diversification are index funds. But, keep in mind that companies held in index funds are generally weighted based on market cap. Therefore they tend to be HEAVILY skewed to the top 10/20 companies, so they don't provide as much diversification as you'd think when you hear you're buying into 500 companies in the S&P 500.