Getting your investment account set up and funded is a solid first move. But don’t forget the next one: picking what to invest in. If you skip it, your money could just sit in cash or a default fund—and miss out on potential growth.
Follow these 4 steps to picking your investments and making sure they work for you over time.
1. Create a game plan
Investing works best with a plan. Begin creating yours by asking yourself 2 questions:
How much risk can I handle?
Risk tolerance is how comfortable you are with market ups and downs. There’s no right answer—knowing your limits helps you stick to your plan and reach your goals.
How long do I plan on staying invested?
This is known as your time horizon—the longer it is, the more growth potential and risk you may be able to take on.
2. Choose your investments
With time horizon and risk tolerance in mind, let's explore investment options. If you're saving for a short-term goal, more conservative and diversified choices may be best. For long-term goals like retirement, you can likely take on more risk for greater growth potential. Aligning investments with your goals can help your money grow while managing risk.
Here’s more info on a few common investments—stocks, bonds, mutual funds, and ETFs:
3. Buy your investments
Once you’ve chosen your investments, don’t forget to buy them. Even if you're not a trader, you'll need to place a trade. When placing a trade, the 2 most common order types are market and limit orders. A market order buys the stock right away at the current price, whatever it is at that moment.
A limit order lets you set the maximum price you're willing to pay—your order only goes through if the stock reaches that price or better.
Your cash is used to complete the trade, and once it's done, you'll see the investment in your account. Just keep in mind—some trades may come with fees.
4. Check in
As life changes, so can your goals, timeline, and comfort with risk. That’s why it’s smart to revisit your investment plan annually—or after major life events—to make sure it still aligns with what matters most to you.
You may need to rebalance your portfolio, adjusting how much you have in stocks, bonds, or other investments, to help stay on track. No matter what, even if you're investing solo, Fidelity offers tools and support to help you invest with confidence.