I am a college student wanting to get my foot in the door of the stock market. I am planning to start with a $500(the minimum to start) Ameritrade account (Suze Orman recommendation) and then add small monthly amounts (Maybe $50) until I graduate in 2 years. After graduation I'll get more serious about it and invest more per month.

What stocks do you recommend? Is it even a good time to invest with the Wall Street crisis? Would you recommend Ameritrade? Thanks

Congratulations on making this commitment! You are head and shoulders above your peers. A lot of people today say "I'll start managing my money when I have more of it." Guess what! If you don't start managing your money, you WON'T ever have more!

I would suggest holding off on Ameritrade. They recently suspend all redemption requests from their primary fund. The entire financial sector is in turmoil. We need to get some clarity on what congress is going to do with the bailout, before we know who is going to survive and who is going to be a casualty. Many of the big names in the business are going under. Billions of dollars are at stake.

My personal favorite broker is ThinkOrSwim. But they are primarily an options broker. They do offer stock and Forex (currency trading), too. They have a lot of educations resources to.

I suggest googling "picking the best broker." Do your own research. The "best broker" is different for everyone. Getting started you will want access to customer service and educational resources. The cheapest commission should not be your guide.

I also recommend is that you read Investors Business Daily everyday for at least 1 week. Read it cover to cover. (It's a lot easier than it sounds.)

The most important thing about investing is not what stocks you pick.

Here's the secret: Have a plan and stick to it.

Buy a stock with an intention and have a back up plan. When do you take profits? When do you get out - if it goes against you?

Keep in mind that most private investors lose money in the market. (Because the lack of a plan.) IBD will help you developing a plan and picking a stock.

Some brokers will allow you to open free "paper trading" accounts where you can play with fake money. This will help you get a feel for how the market works. You might want to try this first.

Ameritrade is ok. It is certainly a better time than it was last October. What a difference a year makes! But it may not be a good time just yet. There is a lot of risk and that $500 might very well come in handy after you finish school and have to get a job and rent an apartment, etc.

If however you really do wish to begin now, I have what I think might be a better suggestion for you than opening an account at Ameritrade. Since you want to invest $50 a month, T Rowe Price has an investment plan which allows you to do just that–invest $50 a month in one of their mutual funds. They call it their Systematic Investment Plan. The Capital Appreciation Fund has been one of my perennial favorites. Sort of a conservative mutual fund with a good track record. They nice thing about this approach is that your investments are diversified and one small mistake will not wipe you out, as it did to many folks who invested in AIG.

http://mutualfunds.troweprice.com/?rfpgid=10875&scn=Mutual_Fund_I_Want_to&origins=prospect

Buy and sell fees eat into profits. You really should be moving lots of $2,000 which is where the buy and sell fees make up less of a percentage than your principal. At $50, the buy and sell fees will eat up over half your pricipal. It would be over an automatic 30% loss just from the buy fee alone.

If the buy fee is $15 and you bought $2,000 worth of one stock, the automatic loss would be .75% which is about how much a stock moves a day.

If you can't move that much money at a time, then look at if your job offers a 401K put the money there. There are no buy and sell fees that you'll see.

If you can move that amount of money, look into ETFs instead. You'll be buying several stocks under one name much like an index (such as the SP500, the DOW or Russell 2000), but in smaller amounts of money unlike an index which may require $5,000 or more to buy one unit of the index (and the unability to buy a partial amount unlike an ETF). Buying either an index or ETF helps prevent loss since one company in the ETF index or ETF could fail, but the chance of most or all of them failing is far less likely.

What ever you buy, look for future relevence. Look at when you plan to sell and what kind of enviroment you think will exist at that time. For instance in the next 18 years or so, 76 million Americans will be turning 65. This group is going to want certain things and the stocks for those certain things are going to be higher then than now.