Many people are interested in starting to save money and invest in the stock market, but they’re scared and unsure of how to do it. They understand that the stock market involves risk and that you can lose money (sometimes even all of it!) by investing in stocks. They still want to start saving and investing, but are not sure how.
It’s actually fairly simple to open a brokerage account. It is also fairly simple to invest in stocks that track the general stock market, so your performance will be about the same as the S&P 500 (the major indice you hear about on the news). Of course, getting fantastic returns or avoiding stock losses when the market goes down is incredibly difficult, but that’s not what this article is about.
If you want to start investing in the stock market and want returns similar to how the stock market is doing in general, follow these simple steps:
2. Deposit money into your brokerage account.
3. Buy either an index fund or an ETF. An index fund that tracks the whole stock market is Vanguard’s Total Stock Market Index, ticker symbol VTSMX. An ETF that tracks the S&P 500 (an indice that tracks the 500 largest US companies) is SPY. If you buy SPY, you should buy the stock while the market is open.
4. Sit back and don’t freak out. The market will have its ups and downs, but it generally goes up over long periods of time.