How to Start Investing: A Guide for Beginners
Starting your investment journey can seem daunting, but it’s one of the smartest ways to grow your wealth and achieve long-term financial goals. Whether you're saving for retirement, a home, or just looking to build wealth, investing can help your money work for you. Here's how to get started:
1. Set Financial Goals
Before diving into investing, define your financial objectives. Are you saving for retirement, building an emergency fund, or planning for a big purchase? Setting clear goals will help guide your investment choices and determine how long you want to keep your money invested.
2. Understand the Basics
Investing doesn't have to be complicated. The key is to understand basic investment vehicles:
Stocks: Buying a piece of ownership in a company. Investing in stocks can be volatile but have the potential for high returns.
Bonds: Loaning to governments or corporations. Bonds tend to carry less risk than stocks, but returns are lower.
ETFs: These are collections of stocks or bonds. They allow you to diversify your investments and are a great option for most investors.
3. Start Small and Stay Consistent
You don’t need a lot of money to start investing. The most important thing is consistency. Commit to investing a portion of your income regularly, whether it’s $10 or $100, this sets the foundation for achieving the goals set in step 1.
4. Choose the Right Platform
There’s a ton of options out there when it comes to choosing an investment platform, and some are better than others. Before deciding which broker to use, it’s important to determine the type of account and style of investing. Here at Core Planning, we rely heavily on Altruist, and I can’t recommend it enough. Reach out if you would like a walkthrough and to discuss next steps.
5. Diversify Your Portfolio
“Don’t put all your eggs in one basket.” Spread your investments across different asset classes or use ETFs to do the diversification for you. Understanding your goals, time horizon, and tolerance for risk are very important before investing.
6. Keep a Long-Term Mindset
Investing is a marathon, not a sprint. The market will have ups and downs, but historically, it has provided strong long-term returns. Patience and discipline are key—avoid trying to time the market or chasing quick gains.
7. Continue Learning
As you get more comfortable, learn more about advanced investment strategies like dollar-cost averaging, compound interest, and tax-advantaged accounts like 401(k)s or IRAs. Most importantly, continue learning about yourself. Have your goals or priorities changed? Are you comfortable with your current financial situation? These questions will drive important changes to your financial plan.
Final Thoughts
Starting to invest is one of the best financial decisions you can make. By setting goals, understanding your options, and taking consistent action, you can build a strong financial future. The earlier you start, the more time your money has to grow. So don’t wait, begin crafting your financial plan today. Remember that I’m here to help you on your financial journey. Let’s connect and get a plan in place!
Tanner Millar
Investment Advisor - Core Planning
tanner@yourcoreplan.com
(660)-998-4639