Investing for a 25-Year-Old
At 25, the compounding advantage of time in market is clearly visible in long-horizon projections. $500 per month invested starting at 25 grows substantially more than the same amount starting at 35 over a 40-year horizon. Review beneficiary designations on all retirement accounts and insurance policies. These designations override your will, so they must be current.
If income is approaching $150,000 (single) or $236,000 (married filing jointly), research the Backdoor Roth IRA process. The Backdoor Roth allows high earners to make nondeductible traditional IRA contributions and then convert them to a Roth IRA, sidestepping the income limit. Beware the pro-rata rule if you have existing traditional IRA balances.