How to Start Investing When You Have No Idea Where to Begin
You don't need a lot of money or a finance degree. You just need to start.
Originally published on Substack
If you’ve ever Googled “how to start investing” and closed the tab because you got more confused than when you opened it, this post is for you.
The financial world has a habit of making simple things sound complicated. But starting to invest is genuinely not that hard. Here’s everything you need to know, in plain English.
First: Why Bother Investing at All?
Because saving alone won’t build wealth.
A typical savings account earns around 0.5% interest per year, if you’re lucky. A High Yield Savings Account (HYSA) does better, with some offering around 3.5% to 5% right now. But even that has a ceiling. Inflation runs at around 3% per year, which means a regular savings account is quietly losing you purchasing power every single year, and an HYSA is barely keeping up.
Investing puts your money to work. The stock market has historically returned around 7 to 10% per year on average over long periods. That means your money isn’t shrinking slowly or barely keeping up with inflation, it’s doing better.
The earlier you start, the more time compounding has to work. At a 7% average annual return, a $2,000 investment at 22 grows to more than $26,000 by 60, while a $5,000 investment at 40 grows to about $19,000. Time beats a bigger balance. Time is the one ingredient money can’t buy back.
What Do You Actually Need to Start?
Less than you think.
A brokerage account. This is just the account where your investments live. Fidelity, Schwab, and Vanguard all let you open one for free with no minimum balance. It takes about 10 minutes online.
Some money to invest. You don’t need thousands. Many platforms let you start with as little as $1 through fractional shares. Even $25 a month is a real start.
Something to invest in. For most beginners, one simple index fund covers everything. VTI (Vanguard Total Stock Market ETF) gives you exposure to roughly 3,700 US companies for just 0.03% in annual fees. Buy it, set up automatic contributions, and leave it alone.
That’s it. Account, money, fund. Done.
The 3 Accounts Worth Knowing About
Brokerage account: No rules, no limits, no restrictions on when you can access your money. Start here if you want flexibility.
Roth IRA: Tax-free growth and tax-free withdrawals in retirement. You need earned income to contribute i.e., a job, freelance work, a gig etc. Up to $7,500 per year for 2026. One of the best financial tools ever created for young people.
401k: If your employer offers one with a match, contribute at least enough to get the full match. That’s free money. Do it before anything else.
Not sure which one to start with? Open a brokerage account today. You can always add a Roth IRA once you have earned income.
The Biggest Mistake Beginners Make
Waiting until they “have enough money” to start investing.
When it comes to investing, stop thinking about “enough”. The right amount to start investing is whatever you have right now even if it’s $10. The habit matters more than the amount in the beginning. Start small, stay consistent, and increase contributions as your income grows.
One More Way to Start: Let Your People Help
Here’s something most people don’t know exists.
If you have a baby shower, birthday, graduation, wedding or any celebration coming up, you can set up an investment gift registry on Endowe and let the people in your life contribute directly to your investment account as a gift. Starting at just $10 per contribution.
Instead of cash that disappears or gifts you don’t need, your community invests in your future. Every contribution goes straight into the investments you chose and starts compounding immediately.
It’s not a replacement for investing your own money. It’s not a replacement for investing your own money but it does remove the most common excuse: not having enough to start investing. You do now. You do. It’s a head start funded by the people who love you.
Set one up at endowe.com. It’s free to create and takes a few minutes.
Your Action Plan
Start with gifts. Set up a free investment gift registry on Endowe at endowe.com. Let the people who love you fund your first investments. Contributions start at just $10.
Grab the free money. If your employer offers a 401k match, contribute at least enough to get the full match. Every time.
Open a Roth IRA. If you have earned income, contribute whatever you can, up to $7,500 for 2026. Tax-free growth. Tax-free withdrawals in retirement.
This is just the beginning and there’s a lot more you can do. But these three steps alone put you ahead of most people.
The best time to start was yesterday. The second best time is right now.
With lots of love,
Your godmother Ada
Disclaimer: As someone in finance as a regulated investment professional, I want to be clear: I’m not your financial adviser, and this post is education, not personalized advice. All investments carry risk including possible loss of principal, and past performance doesn’t guarantee future results. Talk to a professional who knows your full situation before making money moves.
