6 Steps Every Investor Needs To Take In March 2022

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We all dream of building wealth with investing, but successful investors like Warren Buffet and Jack Bogle weren’t made in a day. There were steps they had to take. Through research, trial and error, and understanding their investor personality, they figured out strategies that brought them their wealth. We want to help you do the same.

In this article, we’ll lead you through the first six steps every investor should take, things to consider, and the apps, platforms and services that can guide you along the way. If you have any questions that come up as you read, check out the FAQs section at the bottom of the page.

Step 1: Invest In The Basics — Stocks, ETFs And Bonds

The absolute first thing you have to do is find an online brokerage that offers the type of investments that can help you build a sturdy foundation for your overall portfolio. The most common investments you’ll find in any investor’s portfolio are stocks, funds, and bonds. Why? As volatile as the stock market can be, stocks are known to yield high returns. Funds, of which there are various kinds, are an easy way to diversify your portfolio across investment types in one move. As for bonds, well they are one of the safest investments you can make, with a low chance of price fluctuation in comparison to stocks and other investments.

Check out our favorite investing apps for stocks, funds and bonds below:

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Buy Stock With As Little As $5 In Minutes ($10 Bonus At Sign Up)
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Our #1 Choice
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Trade Big Name Stocks — Amazon, Tesla & More
  • Trade in real-time, 24 hours a day — why it’s trusted by over 22 million users
  • Invest with as little as $1 in fractional shares in top traded companies like Apple, Tesla, and more
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  • 5,000 stocks to choose from, as well as ETFs, options, ADRs, gold and more
  • Unlimited commission-free trades in stocks, funds and options

Get Started With Robinhood Now >

Our #1 Choice
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Professional-Level Trading Platform For Investors Of All Levels 
  • Commission-free stock, ETF and options trading with no trade minimums
  • Set up price alerts, access watch lists and get real-time stock quotes
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  • StockBroker.com’s top choice for 2022*

Get Started With TD Ameritrade Now >

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  • Platform to buy, sell and trade stocks and ETFs, plus get access to educational content tailored to your skill level
  • Earn up to $50 in credit to invest on Tornado when you participate in Learn and Earn
  • Connect with other investors on the platform and see what stocks they’re investing in
  • Get real-time news tailored to your interests and investments
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  • $5.99/month membership fee with 30 commission-free trades included

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Step 2: Diversify With Real Estate To Earn Passive Income

Once you have the core of your portfolio, you can start diversifying with other asset classes. When you diversify your portfolio you limit the overall risk to it, so that one poor-performing asset or asset class doesn’t tank the whole thing.

One asset class people often turn to for diversification is real estate. This is because similar to stocks, real estate generally has strong returns. However, the real estate market is less volatile as it has a low correlation to the stock market. The best part is that real estate can serve as a stable and passive income source via rent payments and you don’t need to own a property outright to enjoy this benefit.

Check out our favorite apps and platforms for real estate investing :

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  • Earn regular income from quarterly return payouts
  • Achieved a 22.9% return average across all client accounts for 2021
  • Low annual advisory fee of 0.15% ($1.50 for every $1,000 invested)

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  • Cash dividends from rent payments are paid out quarterly
  • Get a $10 bonus when you deposit your first $10 or more

Get Started With HappyNest Now >

Our #1 Choice
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Members Have Earned $508 Million In Distributions Since 2014
  • Offers 3 ways to invest commercial real estate — directly into a property deal, managed funds, or tailored portfolios
  • Compare and review real estate projects, view financial documents, and register for project webinars to learn more
  • Only for Accredited investors – a minimum investment of $25k is required for most projects
  • 5-to-7-year investment holding periods

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Step 3: When You’re Ready, Explore Alternative Investments

When you feel like you have a good amount of investing experience under your belt and are confident in your portfolio, you can branch out beyond what’s common and explore other lucrative investments. There is so much more beyond the stock market, like digital currencies, non-fungible tokens (NFTs) and more. Of course, every investment carries risk, so make sure you do your research and are cautious with portfolio allocation.

Check out our favorite apps and platforms for alternative investments:

Our #1 Choice
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Used By 89 Million+ People & Businesses
  • Coinbase started in 2012 with the radical idea that anyone, anywhere, should be able to easily and securely send and receive digital currency
  • Offers a trusted and easy-to-use platform for accessing the broader digital currency economy
  • Get $5 in a popular at sign up

Get Started With Coinbase Now >

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Start Investing In Digital Assets With Your Spare Change
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  • Purchase any asset via a supported exchange, including Coinbase, Voyager and Okcoin
  • Connect your various investment accounts for portfolio monitoring across asset classes
  • Try for free for 30 days, then pay $1/month

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Our #1 Choice
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Used By More Than 1 Million People In 80+ Countries
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  • Borrow money against digital currency assets — APYs starting at 4.5%
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Earn An APY Of Up To 8.05% On Your Investments
  • Buy, sell and store digital currency and research the market through the app
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  • Provides insured hot wallet and cold storage for assets
  • View your account snapshot, watchlists, top movers and educational content on your account homepage

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Step 4: Become An Expert Investor With These Resources

Investing is about more than just where you go to buy, sell and trade. It’s also about staying on top of your finances and figuring out how to prioritize regular contributions to your account(s), regularly monitoring your investments for performance, educating yourself on investing need-to-knows, and staying informed on the latest investing and finance news and trends. Finding the best way to do all of this can be difficult, especially when you’re just starting. Below are some resources that can help.

Check out our favorite resources below:

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Build & Manage Wealth With The Help Of A Financial Advisor
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  • Advisors call you to set up a free one-on-one consultation before you make your selection
  • All advisors undergo strict pre-screening and are FINRA and SEC-registered

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Step 5: Make Sure To Invest For Your Retirement Years

Oftentimes when investing, people tend to forget to take full advantage of the many benefits that retirement accounts, like employer-sponsored 401ks and individual retirement accounts (IRAs), can provide when building wealth for the future.

These accounts have great tax benefits for your invested cash. They reduce your taxable income, you can grow money for life in retirement tax-deferred or tax-free depending on the type of account you choose, and the money is protected from creditors if you were to ever declare bankruptcy, helping you to hold onto your savings. If you don’t have 401k available to you, an IRA is definitely worth getting.

Check out our favorite apps and platforms for IRAs and 401k rollovers:

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  • Manages your portfolio on your behalf, rebalancing it as needed
  • Activate round ups and effortlessly put spare change from your purchases to work in your portfolio
  • Get $10 after you make your first $5 investment

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  • Answer a brief questionnaire to get a custom-built diversified portfolio of stocks and bonds  
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Step 6: Protect Your Family With Affordable Life Insurance

A hard fact of life is that tomorrow is not promised. Whether you’re married with kids, just have a partner, or have other relatives who depend on you financially, life insurance is an investment you should make. It’s the best way to provide for your loved ones in case of tragedy.

A lot of people put off getting life insurance because they look at it as one more expensive monthly bill being added to the rest. Yes, historically life insurance has had a reputation for being costly, but a new wave of online insurers are providing budget-friendly policies that offer fast, comprehensive and flexible coverage.

Check out our favorite life insurance sites below:

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In Need Of A Large Amount Of Cash? Check Out These Loan Alternatives For Homeowners

If you’re a homeowner in need of a large amount of cash, the equity you have in your home can help you get it. Below are services that provide loan alternatives to homeowners through their home equity, all with faster application and approval times than traditional loans.

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A Minimum FICO Score Of 500 And 25% Home Equity Required
  • Hometap offers large cash sums as an investment in your home
  • In return, it gets a share of your home’s future value when its sold
  • Requests of up to 30% of your home’s value or a maximum of $300k are available
  • Get your cash within a few days once you accept the investment offer
  • Hometap investment agreements are tied to 10-year terms

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Don’t Delay Investing — Open A Brokerage Account With Public Today

Opening a brokerage account is the first and most important step. The earlier you start investing, the better off you’ll be in the future because your investments will have had more time to grow your money.

Public is the perfect investing app for beginners. It’s basically the social network of investing. Follow companies, as well as other investors on the platform, and see what stocks they are buying and selling. Start chat groups to have discussions and share insights, and tune into live Q&As with founders and CEOS of top companies, so you can finally ask all your burning questions.

This app is also great for investing on a budget. It has no investment minimums and offers fractional share investing for as little as $5. So even if you only have $10 to spare, you can at least buy a piece of stock and work your way up from there.

Public more than 9,000 stocks and ETFs to choose from, themed ETFs that allow you to invest according to your interests and values, and a growing collection of over 25 digital currencies to work into your portfolio.

Emphasizing education, you can tap on key terms throughout the app for straightforward definitions, the app provides warning labels for volatile stocks, you can access stock performance explainers, and a handful of other educational materials.

The Public app itself is also extremely user-friendly, sleek, and intuitive. Invest in an asset with a few clicks and organize your portfolio according to your short and long-term investments with a quick drag and drop. And if you try and sell a long-term investment before a year is up, you will get a reminder that you are meant to hold onto it for a longer period.

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Frequently Asked Questions

Confused about some of the terms in this post or just have some unanswered questions about investing? Search no more. Below is a cheat sheet of some of the most common investing terms, with definitions and examples.

Investing is a way to potentially grow the amount of money you have — money you can use for your different financial goals, like living life the way you want to in retirement, buying a house, starting a business or just getting to a place of financial freedom in general.

In the most straightforward sense, investing is buying financial assets, also known as financial instruments or products (but more commonly just called investments), that have the potential to increase in value over time and if they do increase in value, you sell them at that higher price to make a profit (a capital gain). You buy these investments through an investment account, of which there are various kinds.

Ready to start investing? We recommend signing up for our #1 pick, Stash.

A security is an interchangeable – meaning it can be exchanged for something else of equal value — financial asset that can typically be traded on both public and private markets. Some of the most common examples of securities are stocks, bonds, mutual funds and exchange-traded funds.

When you’re ready to start investing in securities, you need to sign up for a brokerage in order to buy them. Stash is one of the easiest options to get started with.

Also known as a share or equity, this is probably the most well-known investment type. A stock is an ownership stake in a publicly-traded company — a company that the general public can buy stock in. Think of companies like Apple, Tesla, Amazon and Facebook. When you buy stock in one of these companies, it’s kind of like buying a slice of pie, the pie being the company. And hopefully, the value of the pie piece goes up and when it does, you can sell it for a profit. Stocks can be considered one of the riskier investment types.

Interested in buying stocks? Start buying pieces of stock with Public for as little as $5.

The words “share” and “stock” are both used interchangeably to refer to the partial ownership in a company. While the term stock exclusively refers to a share in a corporate company that is traded on the stock exchange, the term share can refer to equity in a private or publicly-traded company and is not just limited to stocks.

Pro tip: Buy shares in companies before they go public on the Stock Exchange with Robinhood.


When you buy bonds, you are acting as a lender and loaning money to a business or government entity. Businesses issue corporate bonds to investors, while government entities issue municipal bonds. The U.S. Treasury also issues treasury bonds (as well other investments). These bonds all have set interest rates (typically lower than the returns stocks see), which you as the lender collect over a contractually set period of time. Once that time is up, you get the original amount you bought the bond for back. Bonds are generally considered a safer investment than stocks, though, like any other investment, they come with risks. For example, the company you buy a corporate bond from could go under or the government entity could default. Treasury bonds are generally considered to be the safest type of bond.

Instead of just buying a single kind of bond, many investors buy bond focused ETFs to diversify their portfolios. Explore Stash’s various bond ETFs.

With mutual funds, money from various investors is pooled together and put towards a broad selection of investments. Mutual funds are managed by a professional who picks the investments for the pool of investors and works to get them returns or income from said investments. Mutual funds are typically managed with the goal of beating — as in doing better than — a particular market index. A market index is essentially a hypothetical portfolio of a mix of investments that represents a section of the larger financial market, For example, the S&P 500 is an index of the 500 largest publicly traded U.S. companies across various industry sectors that are valued at more than $8.2 billion (among other criteria). We talk more about the S&P 500 further down.

ETFs are similar to mutual funds because they are also a collection of investments that track a particular market index. With in an ETF, you can own a basket of investments (like stocks and bonds) that correspond with a specific sector or industry, asset class, investment style, foreign market, and so on. But unlike mutual funds, ETFs are traded on the stock market on an exchange, meaning they can be bought or sold throughout the trading day (9:30 a.m. to 4 p.m. EST). Because they trade on the stock market (which is ruled by supply and demand), their price does fluctuate throughout the trading day. They also tend to have lower fees, or no fees, in comparison to mutual funds.

Many beginner investors start with ETFs because they are an easy way for them to diversify their portfolios. Public has nearly 50 for you to choose from.

An index fund is a type of mutual fund or exchange-traded fund (ETF), however, the investments in these funds are modeled after or are made to track the returns of a particular market index — like the S&P 500. The goal is for the index fund to perform the same way as the market index it’s modeled after or tracks. An index fund is a great way to diversify your portfolio and is often used to make up the core of an investor’s portfolio.

Many expert investors suggest index funds as a way for new investors to start their wealth building journey. Explore popular index ETFs available through Robinhood.

A fractional share is less than a whole share of a stock, bond or ETF, making it more affordable to buy. Going back to the pizza analogy, think of a company like Amazon as an eight-slice pizza pie and one slice as a single stock. Imagine if someone took one of those slices and then split it up into four smaller slices. Those smaller slices are fractional shares, and because they are much smaller than the original slice, they cost less. So, if a company’s stock is selling for $1,000 apiece and you might not be able to afford that, but because you still want to get in on that stock, you could buy one-fifth of that whole stock (20%) for $200.

Fractional shares are not typically available on the stock market and cannot be sold on the stock exchange. However, they are available through brokerages and can be bought and sold through them.

Interested in buying fractional shares? You can start with as little as $1 with Stash.

A stock exchange is a marketplace where stocks, bonds, ETFs and other securities that are issued by companies are bought and sold publicly. The stock exchange essentially serves as a middleman for companies and investors. It helps companies raise the money they need for operations, and investors ideally buy into a company that will make them a profit if said company performs well and grows in market value. In the United States, we have the New York Stock Exchange. Other countries have their own securities markets.


This is a taxable investment account that can be used to buy and sell a variety of investments, including stocks, mutual funds, bonds, ETFs and more. There are individual brokerage accounts that can be opened by a single person, or joint brokerage accounts that can be shared by two or more people. You can contribute as much money as you want to a taxable brokerage account. Money can be withdrawn at any time, but if the money you’re withdrawing is from an investment you sold at a capital gain, you may owe taxes on it.

Interested in opening a brokerage account? We recommend signing up for our #1 Pick Stash. It only takes a few minutes.

The S&P 500 is a stock market index that tracks 500 of the largest publicly-traded companies in the United States. The companies that make up the S&P 500 are meant to be a representation of the industries that make up the U.S. economy. Because of this, the S&P 500 is used by analysts, economists and investors alike to measure how well the stock market is performing overall. Inclusion into the S&P 500 is determined by various factors, including the total value of a company’s shares, the revenue it brings in, and other factors. Though you can’t directly invest in the S&P 500, you can invest in an exchange-traded fund (ETF), index fund or mutual fund that mimics the S&P 500 index.

For risk averse investors, experts recommend investing in an index fund that tracks the S&P 500. Many online brokerages — including our number one pick Stash — offer index funds that track the S&P 500.

Short selling, which can be done for stocks and other asset classes, is an investment strategy where an investor is betting against the asset they are investing in, meaning the investor is hoping to profit from the asset decreasing in value. For this kind of strategy, an investor borrows stock (like a loan) from a broker, sells the stock and then buys the stock back, ideally at a lower price than they sold it for, and then returns the stock to the lender. The difference between how much the investor borrowed the stock for and how much the stock was bought back for is the investor’s profit.

So, for example, let’s say an investor thinks that Tesla stock, priced at $866, is overvalued, meaning the investor thinks the price of Tesla stock is too high for what the company itself is earning, so they expect Tesla stock to drop in price. Because of that they borrow 15 Tesla shares from a broker, sell each share at the current $866 per share price and then the share price drops in value as the investor predicted by let’s say $300. That investor then buys those 15 shares back at their new price of $566 and returns them to the broker it was borrowed from and the investor nets that $300 per share difference. That investor made $4,500 from short-selling Tesla stock.

Though it can be lucrative, short selling is very risky and should be left to experienced investors.

Adding real estate to your portfolio can be a great way to diversify your investments and it can be very lucrative. There are a couple of different ways to invest in real estate. If you have the means, you can buy rental property or you can flip houses. Both options require you to put up a lot of money upfront and take on a lot of responsibility in terms of property maintenance, which will also end up being expensive. If that’s not something you can afford, or you don’t want the hassle that comes with homeownership, you can get exposure to real estate with real estate investment trusts (REITs), real estate funds or through real estate investment platforms, some of which use crowdfunding methods.

REITs allow you to invest in real estate via companies that own, operate or finance income-producing real estate properties – like retail buildings, apartment complexes and hotels. A real estate fund focuses on investing in securities, like stocks, offered by real estate companies. As for real estate crowdfunding platforms, some offer REITs and funds that individuals can invest in, while others offer properties that they have acquired and investors can buy shares in for partial ownership.

Interested in investing in real estate? You only need $10 to start with Fundrise.

These are tax-advantaged (an account that is either exempt from taxation, is tax-deferred, or that offers other types of tax benefits) investment accounts people use specifically to save for retirement. There are various kinds of retirement accounts, but the most common ones are 401ks — an employer-sponsored retirement plan — and an individual retirement account (IRA) — offered by individual financial institutions, including banks, investment firms and credit unions. There are variations of both of these retirement accounts – traditional and Roth — both of which come with limitations and benefits.

There are two major differences between a Roth and traditional 401k and IRAs. The first is that the money that goes into a traditional 401k or IRA is untaxed and will be taxed at the time of withdrawal. With a Roth 401k or IRA, the money gets taxed before going into the account and can grow tax-free up to the time you withdraw it. The second is the annual contribution amount that the IRS allows you to put into a Roth and traditional 401k and IRAs. For 2022, the contribution limit for both traditional and Roth 401ks is $25,500. If you are 50 or older, you can contribute an additional $6,500 to play catch up if needed. For traditional and Roth IRAs, the contribution limit for both is $6,000, and you can make an additional $1,000 contribution if you are 50 or older.

IRAs are great options for investors because of their tax advantages. Open a Roth IRA or a Traditional IRA with Stash.

An NFT is a digital asset that is used as proof of ownership of a unique (therefore not interchangeable like a security) real-world object, like art, real estate, collectible memorabilia, videos, music, etc. To put it simply, it’s a digital certificate that says something is yours, and this digital certificate of ownership is stored with the same kind of blockchain technology that popular digital currencies use. NFTs have become an extremely popular asset class in the last few years because the blockchain technology that NFTs use makes it extremely difficult for anyone to fraudulently modify records of ownership and it makes buying, selling and trading these unique real-world objects more efficient.

Interested in investing in NFTs? Access this new asset class with Domain Money.

At the root of it, investing is about judgment calls. The goal is to buy low and sell high.

Historically, any time after a market crash is a good time to buy because stocks will be available at a lower price. And remember, market downturns don’t last forever. After a market correction — the sudden drop in a stock or market index’s value, typically by more than 10% — can also be considered a good time to buy. Corrections can help lower overinflated prices for popular stocks and indexes, making it cheaper to buy-in. And generally speaking, it’s a good time to buy a stock if you’ve done your research on it, you think it has real potential to increase in value over time and you’re willing to hold on to it until it does.

It’s important to be patient and not sell off your stocks (or buy) impulsively just because they haven’t increased in value at the pace you want them to or because of analyst projections (remember, their work also involves some guessing). If you’ve done your research and are confident in the potential of the stock you’ve purchased be patient. It can take years for a stock to appreciate to its true value.

There are a lot of reasons why an investor should or could sell their stock. For one, maybe that stock has done well, and they want to cash in on the profits. Some investors may also sell if they have lost faith in the company they own stock in, if they need to liquefy their assets for something like an unexpected expense, to rebalance their portfolio to maintain their ideal investment mix, or to save on taxes.

Some online brokerages offer better educational resources than others to help investors with their decision making. Stash, for instance, has a really stellar library of educational content.

I bonds are virtually risk-free investments backed by the U.S. government. They offer tax benefits and because of inflation their rate of return is expected to rise. Experts are now predicting that I bonds could offer a 9.6% annual return come May, 2022 based on Consumer Price Index data. I bonds pay both a fixed rate return — set by the US Treasury Department — and an inflation-adjusted variable rate return. That changes every six months based on the Consumer Price Index. Because of that, I bonds are particularly attractive investments during inflationary periods.

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1.5%-10% credit card cash back rewards earned on eligible purchases subject to a maximum of $200 cash back per calendar month.