21 yr old in need of advice of investing and saving.

[Team Syntek]

You are off to a great start OP...keep saving!

[Abiezer]

I can spare $750-1000 a month, I want to make smart choices. Should I invest in stocks? Save up for real estate? or what other options do I have? I would like more return than just the small interest of saving's or cd's. I have a good 401k with my job they match up to 5%, I am putting in 5% of each check now should I put more? What else can I do?

I 'll suggest you, just chose that category for invest, in which you have any experience. I think stocks are very good but also risky. If you are beginner now, then you can become a expert. But give time to your business.

[dontgopoor]

- Start reading or listening to podcasts about investments (in addition to asking the good questions that you are asking here)
- Establish your EF first, as suggested by others, 3 to 6 months of living expenses
- Pay off your car
- You indicated that you pay rent but I saw posts about refinancing a mortgage. If you own a house then it does make sense to pay extra each month. The challenge is to balance paying off a mortgage versus investing - some math that's too complicated to go over in this post provides the answer (you can google the question and find some help). I doubt refinancing will be cheaper (do the math or ask for help on the forums or a financially savvy relative/friend). Just pay extra towards principal each month - that's a guaranteed return equal to the mortgage interest rate.
- You already contribute to a 401K up to company match - good
- Start a Roth IRA - better long term tax advantages. Conventional wisdom indicates saving 12% to 20% towards retirement, more % when one is young. Contribute up to the IRS contribution limit or your available funds limit.
- Agree with the other posters to invest in equities with a buy and hold strategy. You are young
and time is your friend. I would start with an index fund from a high quality, established, low cost fund group (like a T Rowe Price or Vanguard)
- Hold off on individual equities until you you have some experience and a good understanding of your risk tolerance

Please ask if you want more info on any of these points. And good job of being smart enough to ask the original question at such a young age.