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Setting Up

First, you have to register for a personal brokerage account for investing. This can be done with TD Ameritrade, Fidelity, Schwabb, even Robinhood, or any other credible brokerage. At the time of writing, I’d perhaps recommend sticking with the first 3 as they are large established firms with credible reputations. Simply go to their website, follow instructions to open a Personal account, and the deposits of the funds you’d like to start investing. The opening of the account will ask you for personal info as ultimately you will have to report your earnings/taxes for. I personally use TD Ameritrade and overall my experience has been fine, and while there may some be a debate on which is the “best” to open with, the truth (from what I understand they mostly differ in customer service/interface/margin rates) the differences are negligible in their core function, and largely you do not need to pay much mind. They may have “rates” /bells and whistles if you wanted to get into fancy stuff, which is not what I’ll cover because the meat is investing. And you don’t have to worry as you won’t necessarily be committing to one, you could potentially open up multiple accounts

Investment Strategy & Philosophy

Once you have the account setup and funds to invest; this is the tricky part. With widespread clashing ideologies, you’ll hear ranging from nonsense to rational advice. Here is a rundown of the general schools of thought that exist. There are ultimately 2 approaches in “investing” (NOT trading which is a short term activity): The Passive vs. Enterprising Investor

• The Passive Investor (buying low-cost indexes and holding for the long-term)

• • Who it’s for:
    • People who don’t have in-depth knowledge of the markets or individual stocks/companies, nor the time/willingness to do due diligence on investments. (The vast majority will and should, rightfully fall into this category, unless your intent is to become an experienced investor and dedicate the proper time to it)
      

• • What to expect:
    • A realistic rate of return that is cited is around 7% annually. (You may see historical claims and averages of 10% annually but to err on conservative/realistic side; 7% is a good point of reference) 
    • Because you may not know what to invest in individually, the intent is to diversify broadly and buy a piece of every large company in the whole market. The idea is if the US economy as a whole progresses (which in general, over a long run – it does/tends to become more productive/higher GDP/improvement/innovative etc) you will enjoy in part of the growth/prosperity. It’s inevitable some business will go bad/business won’t do as well, but the idea of diversification (via buying everything) is that in general, the booming businesses will offset the declining ones. And that as a whole and over time, the economy moves forward. The other way to lose money is if you pay too much for your investment. And this is part of the notion of why people say don’t attempt to time the market (because the vast majority of people will lose money). Instead, employ dollar-cost averaging (DCA) to smooth out the risk.
      

• • How to execute on/what to purchase: 
    • Pick indexes with low expense ratios (the lower the better) to regularly DCA into (buy at regular intervals)
    • DCA is explained above, but the premise is that if you do buy at consistent intervals, by the nature of averages, you’ll offset the effect of possibly overpaying or underpaying because you may be doing both unconditionally. You’ll end up buying when the investment is cheap but also expensive and so averages/smoothes out in the long run rather than running the risk of overpaying all at once.
    • Examples of some commonly regarded “good” indexes include: VTSAX,VTI, VOO, VGT.
      • (These examples given will, of course, differ based on individual circumstances and preferences, so do not take them as gospel. However; I’ve decided to included specifics purely for the sake of providing an idea, so that you can draw your own insight; as I personally find that sometimes advice that is “too general” is not helpful at all. I encourage you all to read, learn, and vet the information yourself so you can develop a solid understanding, but hopefully, this can serve as a helpful roadmap/starting reference on your journey for financial literacy/knowledge.

• The Enterprising Investor (actively selecting individual stocks if you think they are good purchase and/or undervalued)

• • Who it’s for:
    • A person who has a special competency and/or a real understanding of a business model/industry/area. 
    • The skill-set/ability to discern the value of that business
    • A person who has temperance; can withstand volatility; and confident in their own decision making even if people/the market indicate otherwise

• • What to expect:
    • It would be irresponsible for me to tell you a range (negative to 25%+ annually) because it vastly differs and really holds no merit as it is contingent on individual ability. Unless you’re willing to commit the time and due diligence in properly learning the field, and particular business, do not expect to beat the market (if were to just passively buy say the S&P500 Index or the NASDAQ/tech segment). Know you are at an overwhelming informational disadvantage and likely to lose.
    • Put simply; in a marketplace dynamic, unless you’re genuinely familiar with the products/and their values (which unless you’ve conducted your due diligence or have special competency in) you are likely to misprice and lose.

• • How to execute on:
    • If you are still set on learning how to be a more “active”/enterprising investor” knowing the above and general outlook, then there is a rational framework that has been founded by Benjamin Graham and advocated by Mr. Buffet, Charles T Munger and the like. This field is known as Value Investing to which I think will serve as a strong foundation.