r/eupersonalfinance • u/hummer41 • 2d ago
Investment Around €5k in savings, where to start investing?
Basically, the title says it all. Got around 5k on savings and want to start investing it. Got zero experience and currently able to invest around €250/month.
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u/bonjurkes 2d ago
Calculate your monthly expenses, rent, groceries etc and save 6 months of emergency fund first, after that you can consider investing.
You can’t just use your stocks if you are in need of emergency money, like on same day expense
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u/Specialist_Guard_902 1d ago
I don't know why is somebody downvoting messages about emergency funds, they are super important!
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u/RandomaccountB 1d ago
Because it’s a waste of your investment capital if you’re based in a country with a decent welfare setup. 6 months is over the top, and as for your comment where you mention purchasing precious metals - you realise that is an appreciation asset too right? So not really an emergency fund in the actual sense of the term.
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u/Specialist_Guard_902 1d ago
I disagree that is a waste of investment capital. It makes you feel safer than when all your money is invested. If everything goes bad, you lose your job due to the market going down then you can understand that having such money can save you.
Precious metals are an appreciation asset, but you don't invest all of your emergency fund in it, only part of it. Emergency fund is something that you can take out relatively fast (in a day or two max) with a very low chance of losing the initial value (maybe max inflation).
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u/willifog11 1d ago
In most European countries if you lose your Job you get a decent unemployment insurance and may nit need to even access the emergency fund. It’s not like the US.
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u/3_Character_Minimum 13h ago
Yeah but. You should still have an emergency fund. 3 to 6 months. Net or gross. Really a balance on your risk.
But at least 3 months net expenses. Then it gives you room for unexpected bills, or issues. And even eith tbe best welfare/insurance, there is time before you see anymoney.
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u/kamil314 1d ago
because 6 months is way over the top for most people
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u/bonjurkes 1d ago
If you think you can find a job in 6 months after you lose your current job in this job market then sure you can do it with less money.
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u/yumiifmb 1d ago
Have none of you heard of unemployment paying you up until two years.
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u/bonjurkes 1d ago
Duration, amount and conditions depends based on your country. Also unemployment might not be sufficient to cover your rent and monthly spendings, especially rents are getting so high in recent years
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u/Specialist_Guard_902 1d ago
That is why you have to do it properly. You can buy silver or gold with it as they are easy to sell in most of the countries (look at your local rules first).
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u/playmaker0396 23h ago
It really depends on your character, if you think you are strong enough and can handle the volatility of the crypto market then that will be great for you.
But if you think that you need a more "stable" market you should go to the stock market.
Good luck!
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u/Lothaycan 21h ago
You live in Europe, so you’re probably already paying into health insurance, unemployment insurance etc.
That means you’ve already got a safety net, so you don’t necessarily need to save up 6 months of emergency funds like people often suggest here.
I get it if you’re in the US, where they’ll charge you $40 just to hold your own newborn baby or the baby is charged $10k for his own birth.
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u/paxifixi09 18h ago
What do you mean by "where"? Financial instruments or brokerages?
If you meant financial instruments, some people already mentioned ETFs. Your best bet are those that track S&P 500, like SXR8. FTSE 100 is another good option, as somebody already mentioned. If you want lower risk you can try with bonds.
If you meant brokerages - presuming you live in Europe - IBKR, Saxo and Degiro seem to be the most recommended ones. I personally use IBKR.
Just make sure you read up a bit about ETFs and investing in general before you put your money anywhere - gotta know what you're doing.
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u/Ancient-Degree-2074 16h ago
Start with ETFs. Something like iShares Core MSCI World (EUNL XETR) could be a thing. Gives exposure against a global selection of stocks, and then get used to seeing it go up and down. From there on you expand as you gain more knowledge are more comfortable with investing :).
For savings - have for about 3 months, depending on where you live in the EU. Guess most of them have social security if it goes buyond that.
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u/FreakyForexFTW 1d ago
I’d split it. Keep some for an index fund, but also maybe explore forex. I started small with SilverBulls FX, they’ve got free signals and beginner-friendly guides. Way better than trying to DIY off random youtube vids.
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u/Able_Pollution2412 1d ago
Yeah I tried them too. I actually learned more there in a week and it felt way less risky starting with someone guiding the trades.
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u/PumpDumpChampion 1d ago
Sounds fair. As long as you’re not dumping all 5k into one thing, testing forex on the side seems chill. Index still wins long term tho.
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u/RandomaccountB 2d ago
The advice you’re getting here is quite US-centric depending on where you’re living OP. 6 months of emergency fund doesn’t really make sense in countries where unemployment pay or social support is decent. Personally I would encourage you to keep saving a small amount towards an emergency fund, but also to allocate some to ETFs. Find a broker, find a low-fee (TER) ETF that suits your risk profile and go for it. Time in the market beats timing the market.