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I have about 10k GBP in my bank, and I know for most of you that is not a huge amount. However, I will finish university soon and I would like to have in the back of my mind about how to start investing money and handling it.

I have read a few threads on here but they seem to be focused on 401k's etc and seem to be US oriented. If it makes any difference I hope be going into a career of software development.

I would appreciate any advice on the topic, and any recommendations for books for a beginner like me.

PS - maybe its offtopic for this stackexchange but if anyone has advice on how to break into the finance sector as a programmer, that would be great!

MrChrister
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viperfx
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3 Answers3

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There are books like, "The Millionaire Mind" that could be of interest when it comes to basics like living below your means, investing what you save, etc. that while it is common sense, it is uncommonly done in the world. Something to consider is how actively do you want your money management to be? Is it something to spend hours on each week or a few hours a year tops? You have lots of choices and decisions to make.

I would suggest keeping part of your savings as an emergency fund just in case something happens. As for another part, this is where you could invest in a few different options and see what happens.

There would be a couple of different methods I could see for breaking into finance that I'd imagine:

  1. IT of a finance company - In this case you'd likely be working on customizations for what the bank, insurance or other kind of financial firm requires. This could be somewhat boring as you are basically a part of the backbone that keeps the company going but not really able to take much of the glory when the company makes a lot of money.

  2. Brains of a hedge fund - In this case, you may have to know some trading algorithms and handle updating the code so that the trading activities can be done by a computer with lightning speed. Harder to crack into since these would be the secretive people to find and join in a way.

JB King
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  1. Keep enough money for three to six months' expenditure in an instant access account.
  2. Put as much as you can each year into low-cost index-tracking ISAs, up to the annual limit.
  3. Join your employer's pension scheme, if they make contributions.
  4. If you pay higher-rate tax, consider making AVCs to your employer's pension scheme or taking out a SIPP (self-invested personal pension)(which again should go into low-cost index-tracking funds).
  5. Don't tinker. Invest your money and then leave it where it is -- it's only worth changing it in order to rebalance your asset allocation between different investment classes, but you need to have a lot of money invested for that to be worthwhile.
Mike Scott
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I think "Rich Dad Poor Dad" is a good read for understanding the basics of personal finance in a non-technical format before actually starting investing.

John Locke
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