October 6, 2025
Small moves today can snowball into big wins tomorrow.
Starting your investment journey doesn’t take a hedge fund salary or a finance degree. You don’t even need thousands of dollars to begin. What you might spend on a night out, or less, is often enough to get in the game.
Investing is less about where you start and more about building habits that last. Small, steady contributions can open the door to opportunities in stocks, retirement accounts, or even real estate debt. What matters most is deciding to begin and finding an approach that fits your life and goals.
One of the best-kept truths in finance is that time often matters more than the size of your first investment. The earlier you begin, the longer compounding has to do its work quietly.
Compounding means your earnings start to generate their own earnings, like interest adding more interest or reinvested dividends buying additional shares. It’s why a habit of setting aside just $50 to $100 a month in your 20s can outpace someone who waits until later but invests larger amounts.
If you are starting later, of course you can still catch up. Increasing your contributions, taking full advantage of employer matches, and selecting investments that strike a balance between risk and growth potential help close the gap. The key is consistency.
The goal, no matter where you are in life, is to establish a rhythm, whether that involves buying a few shares of stock, putting extra cash into a 401(k), self-directed IRA, or trying something small like investing $100 in real estate debt. The point is not to strike it rich overnight, but to keep showing up, add what you can, and let steady moves turn into meaningful results over time.
It is one of the most common beginner questions, and the answer is, it's usually less than you think. Many brokerages let you open an account with no minimum balance. You can purchase fractional shares of stocks or ETFs for as little as a few dollars. Groundfloor Notes and Flywheel Portfolio start at $100, making them accessible for first-time investors.
It bears repeating, what matters most is not the amount you start with, but the habit you build. Contributing regularly, even in low three-digit amounts, will add up faster than waiting to invest until you think you have "enough."
Every intentional investment begins with a "why." Perhaps you want your money to grow for decades until retirement, or maybe you're aiming for something sooner, like buying a car or funding a side project.
Remember, having a clear purpose for your investments is essential for deciding how much risk you can comfortably handle and how long you can realistically leave your money invested. Without that clarity, it's easy to select investments that don't align with your needs.
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Timeline |
Example Goals |
Possible Investments |
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30 days to 3 yrs |
Save for a car, wedding, or rainy-day fund |
High-yield savings, short-term bonds, invest for 30 days with Notes* |
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3 to 10 yrs |
Down payment, college fund, or launch a side hustle |
Balanced stock/bond funds, diversified real estate debt with Flywheel Portfolio* |
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10+ yrs |
Retirement, financial freedom, or building legacy wealth |
Stock index funds, 401K, IRAs, and Groundfloor IRAs* |
* Notes, Flywheel Portfolio, and Groundfloor IRAs are Groundfloor investment products
Once you've defined the "why," it's easier to choose the "what." That's where asset classes come in. Simply put, asset classes are categories of investments, and each plays a different role in your portfolio. Here are three types every first-time investor should know.
These are shares of companies that can grow your money over time but often swing in value. Great for long-term goals if you can handle volatility.
Bonds are simply loans you make to companies or governments that pay steady, lower-risk income. They serve as a cushion against the ups and downs of the stock market.
You can buy property directly or go indirectly with real estate loans. Debt-based options, like Groundfloor, share expected annual interest upfront, so you know your target return before you invest.
Remember, by combining these building blocks, you create balance and increase the resilience of your portfolio.
Related Article: How to Get Started in Real Estate Investing
Every investment carries some level of risk, but the amount of risk you take should align with your timeline. If you'll need the money soon, you don't want it tied up in something that might dip right when you need it. If you've got years ahead, you can afford to let your investments ride the up and down waves of the market in exchange for higher potential returns.
If you plan to stay invested for at least three to five years, time is on your side. A longer horizon provides a buffer against short-term market dips, making it easier to pursue growth-oriented investments.
Stocks and stock funds are the traditional go-to, often rewarding patient investors over periods of five years or more. But you don't have to limit yourself to Wall Street. Alternative investments, like Groundfloor's Flywheel Portfolio offers diversified real estate loans with terms typically three years or less, providing exposure to property-backed debt with clear target returns that can compound over time.
When your horizon is shorter, safety and predictability matter more than chasing high returns. If you'll need the cash in a year or two or much less, a sudden market dip could derail your plans.
That's where short-term investments including bonds, CDs, money markets, or Groundfloor Notes shine. Notes let you start investing with as little as $100 for a 30-day term. You know the target interest rate before you invest, which means you can plan for near-term expenses while still putting your money to work.
Notes can be a great way to test the waters, build confidence, and even create streams of passive income, all without waiting decades to see results.
There are two main investing styles: active and passive. Active investing involves professionals attempting to outperform the market by selecting individual stocks or bonds. This process usually comes with higher fees, and significantly fewer managers consistently outperform.
Passive investing involves following a predetermined strategy, such as tracking a stock index or investing in a diversified pool of loans. Passive options tend to be less expensive and deliver more consistent results.
Groundfloor offers a passive way to invest in real estate debt. You invest in loans backed by property, and Groundfloor handles the heavy lifting earning passive income. It is a way to add diversification and steady returns without trying to guess the market.
Investing is not just about numbers. It is also about behavior. Many new investors make the same mistakes, and avoiding them can make the difference between steady growth and costly setbacks.
Markets fluctuate, sometimes dramatically. Selling in a panic locks in losses and often means missing the rebound. A downturn is usually temporary, but the decision to sell at the wrong time can have a permanent impact.
Everyone wishes they could buy at the bottom and sell at the top, but in reality, even professionals rarely get it right. Waiting for the "perfect time" often results in sitting on the sidelines while your money could have been growing.
From meme stocks to crypto surges, hype-driven investments can look tempting. The problem is that when everyone else is rushing in, prices are often inflated. By the time the excitement cools, latecomers are left holding the bag. Instead of chasing the next craze, consider steadier alternatives, such as real estate debt investing, which offers clear terms and predictable returns.
Always keep in mind that the best strategy really is the simplest. Set your plan, stick to it, and invest consistently — avoid panic moves, ignore the noise, and remember your long or short-term goals.
One last piece of advice: Jumping straight into investing without a safety net is like walking a tightrope between high-rise buildings without a harness. It only takes one surprise to throw you off balance.
Before you put money into stocks, bonds, or longer-term real estate debt, make sure you have a financial cushion in place. Aim to set aside three to six months of basic household expenses in a savings account or another spot you can access quickly. This way, if a car repair, medical bill, or job change comes up, you will not be forced to sell your investments at a potential loss.
While emergency funds are not glamorous, they keep your long-term investments safe. Some investors also add very short-term, lower-risk vehicles, like Notes or CDs with short terms, as a complement to their cash savings. While not a replacement for an emergency fund, these options can give your money a little extra earning power while still keeping it relatively accessible.