The decision to become a real estate agent is an important step in anyone’s career journey. People enter the field of real estate from different professions and careers and at different stages of their lives. Everyone has different reasons why they think real estate is the right career choice. But one question comes up over and over again from people who want to enter the real estate industry, “How do I become a real estate agent?”

The simple answer is, “It depends. “It mainly depends on where a person wants to practice real estate. Becoming a real estate broker requires a state license. Each state regulates its own real estate licensing process, and each state’s rules or regulations differ slightly. However, there are some basic requirements that are always consistent.

General requirements to qualify as a real estate salesperson.
To be eligible to become a licensed real estate salesperson or agent, you must:

Be at least 18 or 19 years of age (depending on the state)
Have legal U.S. residency
Complete your required Prelicense education (find your state’s requirements)
Pass your state real estate license exam
These items represent the high-level checklist of what it takes to become a licensed real estate agent, but there are many decisions you must make along the way that will determine whether or not your journey is successful.

Is real estate right for you?
The first step in the process is making sure real estate is right for you. As a real estate salesperson, every day is spent working for you. This means managing your own office, completing paperwork, prospecting leads, building relationships, managing contacts, and dealing with buyers and sellers. Contact local real estate agents and brokers and ask them questions about their day-to-day work. Ask questions about real estate as a long-term career. Starting a full-time career as a real estate agent can’t be treated like a hobby. It requires a full commitment. Make sure real estate is the right path for you.

Are you thinking about starting a real estate career? Download the Start Your Real Estate Career eBook.
How to become a real estate agent
While specifics vary by state, there are five steps each individual must take to earn their license and become a real estate agent.

Step 1: Understand your state’s real estate licensing requirements.
Each state’s real estate licensing requirements are different. Your state’s real estate commission website lists the official pre-licensing requirements. Kaplan Real Estate Education offers a few pages that narrow this knowledge gap. The Steps to Licensing page is designed to show in simple steps what it takes to become licensed in each state. In addition, Kaplan offers a page dedicated to each state’s real estate licensing and continuing education requirements. See the link below for your state’s pages.

Step 2: Enroll in a real estate pre-licensing course.
There are several ways you can fulfill your real estate pre-licensing requirements, from live classrooms at local real estate schools, Some real estate companies, universities and technical schools offer real estate licensing programs, home study and online real estate education. This is an important decision in your journey. Make sure you enroll in a school that has a good reputation, offers quality content and instructors, and focuses on positive student outcomes. Your real estate licensing education will be difficult and comprehensive, but it will also be the springboard to a successful career as a real estate professional.

Step 3: Apply to take the real estate salesperson exam.
Timing is important in this step. Make sure you follow the application process with your state so you can sit for your real estate agent exam soon after you finish your real estate licensing classes. This process will be state specific and will involve a fee. Check with your state’s real estate regulatory agency for complete details. In some states, you will need to submit fingerprints and pass a background check. This can take weeks to process. In many states, the application process must be completed before you can register or schedule your exam appointment. Don’t let the paperwork become a roadblock to getting started in your new real estate career.

Step 4: Pass the real estate salesperson exam.
Passing the real estate exam takes more than finishing the educational requirements-it takes preparation. Not everyone passes the exam the first time. Preparing for the state exam requires additional study time. Kaplan strongly recommends signing up for an exam prep class. Since the ultimate goal is to help you pass the exam, most Kaplan pre-licensing packages include the comprehensive exam preparation course. Taking practice exams, measuring your strengths and weaknesses, and working through a comprehensive topical review will sharpen your knowledge and prepare you for exam day.

Show up to the exam site with a positive attitude, answer the questions with the vast knowledge bank you’ve accumulated in your studies, and walk out with a passing grade on your state real estate exam!

Step 5: Find a real estate agent
Your passing grade on your state real estate licensing exam doesn’t quite mean you have a license. A real estate salesperson (agent) is authorized to act on behalf of a broker and may not act independently as a real estate broker. Consider finding a real estate agent at the beginning of your licensing process. Once you have met your pre-licensing requirements and passed your exam, you and your broker will need to complete final paperwork with the state. Once the form is accepted, your license will be issued and you can practice real estate under the broker’s auspices. Keep in mind that there are a number of things to consider when looking for the right real estate brokerage.

Good luck on your path to licensing as well as your subsequent successful career as a real estate agent! Every day can be unique and different for a real estate agent, and it can be a very rewarding and exciting career!

Investing is a way of putting money aside while you are busy with life and making that money work for you so that you can fully reap the rewards of your work in the future. Investing is a means to a happier ending. Legendary investor Warren Buffett defines investing as ” … the process of putting money away now in order to get more money in the future. “1 The goal of investing is to put your money into one or more types of investment vehicles in hopes of increasing your money over time.

Let’s say ,you have $1,000 set aside and are ready to enter the world of investing. Or maybe you only have an extra $10 a week and would like to invest. In this article, we’ll walk you through how to get started as an investor and show you how to maximize your returns while minimizing your costs.

What kind of investor are you?
Before committing your money, you need to answer the question, what kind of investor am I? When you open a brokerage account, an online broker like Charles Schwab or Fidelity will ask you about your investment goals and how much risk you want to take.

Some investors want to be actively involved in the growth of their money, and some prefer to “set it and forget it. “More traditional” online brokers, like the two mentioned above, allow you to invest in stocks, bonds, exchange-traded funds (ETFs), index funds and mutual funds.

Online brokers
Brokers are either full-service or discount. Full-service brokers, as the name implies, offer the full range of traditional brokerage services, including financial advice for retirement, healthcare, and anything money-related. They typically deal only with high-net-worth clients and may charge significant fees, including a percent of your transactions, a percent of your assets under their management and sometimes an annual membership fee. It’s common to see minimum account sizes of $25,000 and up at full-service brokers. Still, traditional brokers justify their high fees by providing detailed advice to your needs.

Discount brokers used to be the exception, but now they are the norm. Discount online brokers provide you with tools to select and place your own trades, and many of them also offer a set-it-and-forget-it robo-advisory service. As the 21st century has progressed, online brokers have added more features, including educational materials on their websites and mobile apps.

Although there are a number of discount brokers with no (or very low) minimum deposit restrictions, you may face other limitations, and accounts that do not have a minimum deposit will be charged certain fees. This is something an investor should consider when looking to invest in stocks.

Robo-advisors
After the 2008 financial crisis, a new type of investment advisor was born: the robo-advisor. Jon Stein and Eli Broverman of Betterment are often credited as the first in the space.2 Their mission was to use technology to lower costs for investors and streamline investment advice.

Since Betterment’s launch, other robo-first companies have been created, and even established online brokers like Charles Schwab have added robo-like advisory services. According to a report by Charles Schwab, 58% of Americans say they will use some type of robo-advice by 2025, if you want to use an algorithm to make investment decisions for you, including tax loss harvesting and rebalancing, A robo-advisor can be for you. And as the success of index investing has shown, if your goal is long-term wealth creation, you might do better with a robo-advisor.

Investing through your employer
If you’re on a tight budget, try investing just 1% of your salary in retirement savings available to you at work. The truth is, you probably won’t miss even that small a contribution.

Work-based Retirement Plans deduct your contributions from your paycheck before taxes are calculated, making the contribution even less painful. Once you’re comfortable with a 1% contribution, you may be able to increase it if you get annual increases. You probably won’t miss the additional contributions. If you have a 401(k) retirement account at work, you may already be investing in your future with allocations to mutual funds and even your own company’s stock.

Minimum to Open an Account
Many financial institutions have minimum deposit requirements. In other words, they will only accept your account application if you deposit a certain amount of money. Some companies won’t even allow you to open an account with a $1,000 deposit.

It’s worth shopping around some and checking our broker reviews before deciding where to open an account. We list minimum deposits at the beginning of each review. Some firms don’t require minimum deposits. Others can often reduce costs, such as trading fees and account maintenance fees, if you have a balance above a certain threshold. However, others may specify a certain number of commission-free trades to open an account.

Commissions and fees
As economists like to say, there is no such thing as a free lunch. Although recently many brokers have raced to lower or eliminate commissions on trades, and ETFs offer index investing to anyone who can trade with a bare bones brokerage account, all brokers have to make money from their clients one way or another.

In most cases, your broker will charge a commission every time you trade stocks, either by buying or selling. Trading fees range from the low end of $2 per trade, but can be as high as $10 for some discount brokers. Some brokers don’t charge trading commissions at all, but they make up for it in other ways. There are no non-profit organizations that run brokerage services.

Depending on how often you trade, these fees can add up and affect your profitability. Investing in stocks can be very expensive if you enter and exit positions frequently, especially if there is little money available.

Remember, a trade is an order to buy or sell shares in a company. If you want to buy five different stocks at the same time, it will be considered five separate trades, and you will be charged for each one.

Now imagine that you decide to buy the shares of these five companies with your $1,000. For this purpose, you incur a trading cost of $50-assuming the fee is $10-which is 5% of your $1,000. If you were to invest the 1,000 USD in full, your account would be reduced to 950 USD after the trading costs. This represents a 5% loss before your investments even have a chance to earn.

Should you sell those five shares, you would again incur the cost of the trades, which would be another $50. The round trip (buying and selling) of these five shares will cost you $100 or 10% of your original deposit amount of $1,000. If your investments do not earn enough to cover this, you have lost money simply by entering and exiting positions.

If you like to trade frequently, check out our list of brokers for cost-conscious traders.

Mutual fund loads (fees)
In addition to the trading fee for buying a mutual fund, there are other costs associated with this type of investment. Mutual funds are professionally managed pools of investor funds that make concentrated investments, such as large cap U.S. stocks.

There are many fees an investor incurs when investing in mutual funds. One of the most important fees to consider is the Management Expense Ratio (MER), which is calculated each year by the management team based on the number of assets in the fund. The yield ranges from 0.05% to 0.7% annually and varies by fund type. But the higher the MER, the more it affects the fund’s overall returns.

You may see a number of sales charges called loads when you buy mutual funds. Some are front-end loads, but you’ll also see no-load and back-end load funds. Make sure you understand if a fund you’re considering carries a sales load before you buy. Look at your broker’s list of no-load and no-transaction-load funds if you want to avoid these additional fees.

In terms of the beginning investor, fund fees are actually an advantage over stock commissions. The reason is that the fees are the same regardless of the amount invested. Therefore, as long as you meet the minimum requirement to open an account, you can invest as little as $50 or $100 per month in a mutual fund. The term for this is called Dollar Cost Averaging (DCA) and can be a great way to start investing.

Diversify and reduce risk
Diversification is considered the only free lunch in Europe. In short, by investing in a range of assets, you reduce the risk that the performance of one investment will severely impact the return on your overall investment. You might think of it as financial jargon for “don’t put all your eggs in one basket.”

In terms of diversification, the biggest difficulty here will come from investing in stocks. As mentioned earlier, the cost of investing in a large number of stocks could be detrimental to the portfolio. With a $1,000 deposit, it is almost impossible to have a well-diversified portfolio, so you may need to invest in one or two companies first. This increases your risk.

This is where the big advantage of mutual funds or exchange traded funds (ETFs) comes into focus. Both types of securities typically have a large number of stocks and other investments within the fund, making them more diversified than a single stock.

Final Ideas
It is possible to invest when you are just starting out with a small amount of money. It is more complicated than just choosing the right investment (a feat that is difficult enough in itself), and you need to be aware of the limitations you face as a new investor.