Stocks for Beginners to Invest In

So, you finally decided to invest your money. Congratulations, it’s about time. Now that you’ve made the plunge, the real fun begins.

Picking stocks can seem overwhelming. So many symbols, fancy finance language, thousands of “experts” telling you what to buy or not to buy. If investing in the right stock was easy, everyone would be rich. But here are some stocks beginners should consider investing their money into.

Before we go into the stocks, remember it’s time in the market, not timing the market that will get you good results.

S&P 500

The S&P 500 is a stock market index that measures the stock performance of 500 large US companies listed on stock exchanges. When people talk about “the market” being up or down, the S&P is usually what they are referring to.

Individual stocks go up and down. The stock market does too. But over time, the stock market is likely to go up. Look at any chart of the S&P 500 over time.

The easiest way to buy this is with the ticker “SPY”. Depending on who you have an investment account with, they may have their own market fund. Vanguard has the VOO, and other firms have their own ETFs replicating the S&P 500 as well.

Big Tech

A few years back all the hype was about FAANG. And for good reason. FAANG stands for Facebook, Apple, Amazon, Netflix, and Google. These stocks have grown tremendously over the last ten years, three years, or even since the market bottomed out in March.

Technology is a growing part of our lives. And these stocks have skyrocketed. Another big name in tech is Microsoft. The US companies with the biggest market capitalization (the value of a company) are Apple, Microsoft, Amazon, Alphabet (Google’s parent company), and Facebook. The five biggest companies are all big tech. They have dominated the market and people’s portfolio recently.

The Kings of Dividends

Older investors love dividends. Big dividend stocks offer consistency and typically the stock price will be less volatile. There is an exclusive club for dividend kings.

Dividend kings are companies that have raised their dividends for fifty(!) straight years. The payment they give out for owning the stock will grow each year that you hold onto that stock.

These companies include Hormel Foods, Stanley Black & Decker, Colgate-Palmolive, Coca-Cola, Johnson & Johnson, 3M, Procter & Gamble, Emerson Electric Co., Genuine Parts Company, and Dover.

These might not be the most exciting names, but I’ll take consistent, growing returns on my money any day.

Other Big Name Companies

If for some reason you still aren’t sold on any of these options, good news. There are thousands of other stocks to consider. But not all of these will be winners.

One strategy is to look at large, recognizable companies. A quick look at Fortune’s list of the largest 500 companies provides many great options. Notable companies we haven’t mentioned yet, that are easily relatable and understandable include Walmart, Costco, Home Depot, Nike, Visa, and more.

Closing Remarks

A well-diversified portfolio can reduce your risk and increase your chances of making money.

There is risk to investing. Higher risk, higher reward. It’s the reason your savings account gives you less than 1% of interest while the stock market annually returns 8% over time. Choosing what to invest in is not an easy decision, but the sooner you make a smart decision, the sooner you are to financial freedom.

Disclaimer – The opinions expressed in this blog are for general informational purposes only and are not intended to provide specific advice or recommendations for any individual or on any specific security or investment product. It is only intended to provide education about the financial industry.