Investment compounding - continually reinvesting any gains to, in turn, earn more gains - has been referred to as the "eighth wonder of the world." While you may not have much excess money when starting out in life, you have one deciding edge over those older and wealthier: more time for assets to grow and compound. It’s an advantage you don’t want to pass up. 

Save Now

Get in the habit early of saving and investing something each month. An automatic savings plan - either one you enroll in at work or one you create yourself - is a disciplined way to save. A good rule of thumb is to save at least 10% of your household income each year.

Smaller investments made earlier in your career may actually end up being worth far more than larger investments made later, due to the power of compounding over time.

Diversify Now: Why And How

How you allocate your investments across asset classes - such as stocks, bonds, different categories of mutual funds and cash - may have a greater impact on your long-term performance than the individual investments you select. Learn about the different asset classes and what kind of asset allocation strategy may be best for you.

When you are just starting out, if your portfolio size is limited, consider that mutual funds may allow you to be better diversified within a smaller total investment than if you invest in individual stocks and bonds.