The Reds have already signed 21-year-old Jordan Henderson from Sunderland this summer while the likes of Jay Spearing, John Flanagan and Jack Robinson have all appeared for the first team.
Carragher, now 33, agrees that placing trust in youth is the correct way forward as the team prepare for another Premier League season.
Carragher told the club's official website: "The club now has a policy of focusing attention on young players and I think that's the right way for clubs to go.
"You want to develop a team and have players at the club for a long time. I think that approach will really benefit us.
"Things don't always work out, but it's much easier to move on a younger player who still has a decent sell-on value than someone in their 30s."
The former England defender is also impressed by Henderson and believes he will just be the first new arrival at Anfield this summer.
He said: "Jordan is a great signing. I know one of the coaches at Sunderland who rates Jordan very highly.
"He had a great season with Sunderland and we're fortunate to have got him. I think he will add real energy to our midfield.
"It's still very early and I didn't expect too much to happen on the transfer front before now.
"Over the summer players, managers, chief executives and owners are all away on holiday.
"It's only the start of July and with pre-season getting going next week I'm sure things will soon start moving.
"You often find that one deal sets it off and everything happens from there.
"I'm sure it will kick off over the next few weeks and hopefully we'll get a couple more new faces in."