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Entering the world of investing isn’t easy—there’s a huge amount of information out there, and taking your first steps into the market without knowing what you’re doing is very dangerous. Fortunately, there are quite a few tools that will help you get started investing and saving money IFTTT Recipes That Help You Save Money IFTTT Recipes That Help You Save Money IFTTT can be used to do nearly anything, and saving money is no exception. Here are some of the best recipes to help you live more frugally. Read More , even if you’re a total beginner and don’t follow the financial news The 6 Best Sites for Keeping Up-To-Date with Financial News The 6 Best Sites for Keeping Up-To-Date with Financial News Keeping on top of financial news is a necessary chore for almost everyone. We take a look at six of the best sites to keep you abreast of breaking stories. Read More religiously. Here are six of the best.

Betterment

After getting some information about you, including your income and goals, Betterment suggests priorities and an investment plan to help you get there. You set up a monthly contribution to your Betterment account, and it’s automatically invested in a variety of places—some low-risk and some moderate-risk—to help you create a diversified portfolio.

betterment-goal-setting

The algorithms used to make recommendations take into account your goals and recommend certain mixes of conservative and more risky investments to increase the likelihood of reaching your goals in your timeframe. It also performs automatic rebalancing to keep an optimal distribution of assets, helps you consolidate and manage your retirement accounts, and take advantage of any losses by claiming them on your taxes.

With fees between 0.15% and 0.35% (depending on your account balance), Betterment is a much more affordable option than many traditional investment methods. There’s no minimum deposit, and no minimum balance.

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SigFig

SigFig aims to put your money in low-risk, low-cost funds so that you can make the most of your money. After you’ve made the minimum deposit of $2000 and answered a few questions about your risk preference, SigFig will calculate an optimal distribution of investments and make them for you (you can also manually adjust your risk preference).

sigfig-plan

The advisors at SigFig can also help you get your current portfolio in order so that it best helps you meet your goals. And while your account balance is under $10,000, you pay no administration fee. After that, it’s 0.25%, making it a lot cheaper than traditional invesment managers.

Your investments will be guided by Modern Portfolio Theory, a Nobel-Prize-winning theory of investment, which the company believes will minimize risk and maximize return on your investments. According to Wikipedia, the theory has lately come under fire, but the fact that it won a Nobel Prize speaks highly of its return potential.

FutureAdvisor

Another service that makes an effort to point out its reliance on Modern Portfolio Theory, FutureAdvisor is strongly focused on retirement planning Now Is The Time: Tips To Go Online & Plan For Your Retirement Now Is The Time: Tips To Go Online & Plan For Your Retirement Now is the time to start planning for your retirement. Now is the time to take control of it, and put the responsibility back into your hands. Work at it with some web tools. Read More and saving for your kids’ college tuition. By emphasizing transparency and full-portfolio management, FutureAdvisor aims to help you get to retirement age with enough money to see you through.

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And when it comes to college savings, the site puts your money in the best type of account, no matter where it is—which means they go through each state-specific account and see if it will work for you. Based on the expected return over 20 years, FutureAdvisor will net you an additional $65,000 in college savings over a 0.5% interest rate savings account.

The fee for retirement planning is 0.5% per year, making it one of the more expensive online options, but college savings planning is free, with no limit on time.

WealthFront

With a team of highly regarded investors and entrepreneurs behind it, WealthFront brings to bear a lot of expertise in handling your money. Their team has collectively written 16 different books on the topic, which should give you an idea of how much thought they’ve put into it.

wealthfront-diversification

By investing in diversified markets and handling both retirement and non-retirement accounts, WealthFront aims to help you get a solid return on your investment. And by closely monitoring how your investments perform and taking into account the tax implications of that performance, they also minimize the amount of taxes you pay, increasing your earnings over time.

WealthFront has the highest minimum investment of the services here, with an initial deposit of $5,000 required. They won’t charge you a fee on an account balance of less than $10,000, but once you break that threshold, you’ll pay 0.25% annually.

Tip’d Off

If you’re looking for something really different from traditional investing methods, Tip’d Off might be for you. Instead of using algorithms to guide your investing, this site lets you watch and learn from other investors. By crowdsourcing What Is Crowdsourcing & How It's Used [INFOGRAPHIC] What Is Crowdsourcing & How It's Used [INFOGRAPHIC] Have you ever wondered what crowdsourcing is, what sites on the Internet take advantage of it and its influence online? Well now all your questions will hopefully be answered with this infographic, designed and produced... Read More investment data, Tip’d Off gives you more than just advice: it gives you hard data, too.

tipd-off

By watching what other users are doing and sharing tips and advice on trading, Tip’d Off helps you trade at the same time that it helps you learn. If you’re looking for an investing solution that will not only help you invest effectively, but also help you learn enough to manage your own stocks in the future, this is a good way to go.

Tip’d Off also offers paper trading, which allows you to practice trading with fake stocks 3 Virtual Stock Market Games That Help You Learn How To Invest 3 Virtual Stock Market Games That Help You Learn How To Invest Read More to get the hang of the investment game.

Professional Advice

If you aren’t comfortable leaving your money in the hands of an equation, and the rather informal nature of Tip’d Off doesn’t appeal to you, there are a number of online investing resources 10 Financial Websites That Help You Stay On Top Of The Market 10 Financial Websites That Help You Stay On Top Of The Market Read More that can help you learn your way around the stock market yourself. This takes a lot of work, but it can be very rewarding.

motley-fool-how-to-invest

Read investing blogs; The Motley Fool’s How to Invest and About.com’s Investing for Beginners are great places to start, and InvestorPlace and Forbes’ Investing section are good ones to graduate go. Read magazines like the Financial Times, Barron’s, and Kiplinger’s. There’s also a great list of books for beginning investors at InvestorPlace.

And, of course, you can always talk to a financial advisor. If you start investing without knowing what you’re doing, you’re taking on a huge amount of risk that could result in a large loss of money. Talking to a financial advisor MyFinancialAdvice: Find Financial Advisors For Your Specific Needs MyFinancialAdvice: Find Financial Advisors For Your Specific Needs Read More can help you mitigate some of that risk by taking advantage of years of experience (though it will cost you more money than the options above).

Start Today!

By managing your investments well, you can save a lot of money for the future, whether you hope to use it for retirement, buying a new home, sending your kids to college, or just having some savings put away. These six different ways of getting into the market without a lot of knowledge will help you get started.

Have you used any of these investment tools? What resources have you found to be the most useful? Share your thoughts and favorite links below!

Image credit: Businessman checking stock market on tablet (edited) via Shutterstock.

  1. Grant
    May 15, 2015 at 8:33 pm

    Dann, great set of tools! I feel like you may have missed an opportunity to stress some of the benefits of Wealthfront. First, you do mention it in a round-a-bout sort of way, but it is FREE for beginners. No recurring charges is HUGE. You can even continue to get the service for free beyond the 10k initial limit by inviting other investors. I started with them last year, and have increased my managed funds limit to 15k. I don't pay them a cent. And it's possible to raise that up to 25k managed for free.

    I like that system because basically they say, 'If we don't help you make money, you don't owe us anything.' Couldn't be a much better fit for beginners.

    • Dann Albright
      May 19, 2015 at 6:32 am

      Thanks for sharing your experience, Grant! I wasn't aware that you could stay fee-free by inviting other investors; that's awesome. I can see how that could save you a lot of money over time if you're successful in doing their recruiting for them.

      Great tip!

  2. David
    May 15, 2015 at 7:32 pm

    Is any of these available outside US?
    If not could anyone suggest services that are?

    Thanks in advance

    • Dann Albright
      May 16, 2015 at 7:47 am

      I think most of these are US-only, but if I remember correctly, Acorns will be expanding internationally in the near-ish future. Which country are you looking to invest in?

    • David
      May 16, 2015 at 11:00 am

      I am from Armenia. We have commercial banks that have broker services for financial market investments, but I wonder if there are online services similar to these that are not restricted to any countries.

    • Dann Albright
      May 19, 2015 at 6:30 am

      Hm . . . I believe all of these are US-only (or possibly US-and-Canada-only). I'll keep an eye out for international ones, though, and I'll let you know if I find anything. Hopefully someone else will be able to give you a recommendation before then!

  3. Bob E
    May 15, 2015 at 12:08 am

    Yes, start today. As for the rest of the formulae ... throw them out. Educate yourself and DO NOT depend on ANYONE else's percentage distribution or automatic anything. A great place to start with both that self-education and a proven methodology is BetterInvesting - the magazine and the website (www.betterinvesting.org). Note that the operative word is methodology. It is NOT a formula. It does provide a structure (proven for over 50 years but tweaked a few times). It helps you to understand the places where you apply your judgement and to understand what factors make for a good investment. The organization also has guidelines to help you with how to approach investing, and publications to explain all the above.

    For the record, I am a member of BetterInvesting. I started using the methodology in 1991 and retired in 1998 - largely do to the positive investment results therefrom.

    • Dann Albright
      May 15, 2015 at 9:45 am

      Does BetterInvesting provide any personalized advice? Are there financial advisors that you can talk to, or does it only consist of the magazine and the content on the website?

    • Bob E
      May 16, 2015 at 1:08 am

      Dann, The short answer to "personal advice" is "No." A bit of expansion. BetterInvesting began life as National Association of Investors Corporation (NAIC) in (I believe) the early 1950's. It started as an association of investment clubs. Today, it has both club and individual memberships. It renamed/remarketed itself BetterInvesting (BI) in about 2005, adopting the name of its long-published magazine. It DOES NOT supply individual advice, just a lot of good how-to-do-it for those who want to control their own money (and financial destiny). IMO, that is much more valuable. In another post, I noted my annual return using their methodology. It significantly beats any publicly available investment I have seen. Some whom I have taught (to friends and family, with no sponsorship, sanction, or affiliation with BI/NAIC itself) have quite correctly noted that YMMV.

      BI/NAIC has their methodology and guidelines. They also have software to help one with the calculations required to use same and some services to access the raw data. By the time said software was initially offered, I had long before built my own spreadsheet doing the same, and incorporating a few of my own 'helpers.' [Besides it was originally, and may still be, only available on a Windows platform and I use Macs.] So I have no personal experience with it, but have seen it and it looks good. BetterInvesting, the magazine, is available in many (most?) sizable public libraries. BI, the organization, offers courses online and through a national network of regional organizations - with contact information for them contained in each issue of the magazine. Coincidentally, I received an e-mail from the organization today suggesting I "Invite a Guest to Attend our FREE Open House Webinar - Come On In and Sample our Resources" on May 26, 8:30-9:00 p.m. I have not looked, but would expect that invitation to be available on the website I cited above.

      Now, back to "personalized advice." Call me cynical, but I do not believe any financial adviser, whether individually oriented or touting a product, will ever completely have only YOUR interest in mind and action. Per force, said person must be in the business to make money for her/himself and that creates an inherent potential conflict of interest. At the very least, the cost of such service subtracts from your profit. I will grant that what I do using the BI/NAIC methodology is not for everyone. One must have the willingness, time, and interest to do things for oneself. [Before the software, enough basic understanding of mathematics (mainly arithmetic) was also needed, but the software eliminates that requirement.] However, the rewards, both financial and personal, are (or can be) significant.

    • Bob E
      May 16, 2015 at 1:17 am

      Oops, I meant to include this in the above comment:
      The BI regional organizations can help anyone find an investment club to check out. Well, almost anyone - don't know about those living in very remote areas, although there are clubs that operate 'online.' Each issue of the magazine has a "Repair Shop" feature that discusses the portfolio of a club. A club that uses the BI/NAIC methodology can be an EXCELLENT way to introduce oneself to it and to profit from the experience of others who have been doing their own investing.

    • Dann Albright
      May 16, 2015 at 7:46 am

      Bob, thanks for the very detailed explanation of BI! It sounds like a great program, and something that a lot of people should check out. Not being an experienced investor myself, I have no idea how the information presented in BI compares to some of the more reputable free sources of information, but it sounds like you think it's quite superior.

      One thing that you said stuck out at me: "One must have the willingness, time, and interest". And to invest in a manner like you would as a member of BI (or other investing clubs / systems), that's definitely true. But I think a lot of people don't have the willingness, time, OR interest for something like that, but still want to make smart decisions with their money. If they want to get into the stock market as part of those smart decisions, I think an algorithmic solution is a good idea. Obviously, they aren't going to get as good of returns as you will if you spend the time to learn the system and watch the market, but I'm sure a lot of people are happy to make the trade-off.

      As for your "cynical" view on personal advice, I think that's a fair point, and it's one that other people have brought up, too. However, I also think it's important to remember that financial advisors, even though they're trying to earn money, also need to help you be successful, lest they lose customers and run fewer trades. It's definitely a two-way street. If the financial advisor is giving advice that makes them a lot of money but knocks their customers out of the market, they're not going to be in business very long!

      Thanks a lot for your comments here—they've been very enlightening!

    • dragonmouth
      May 17, 2015 at 2:30 pm

      Dann,
      You seem to think that beginner investors need to have their hand held by some kind of a financial professional. In theory and in the ideal world, yes. In the real world, all novice investors need is some education. Take an investing course or two at the local college. Read books about the basics of investing. Check out web sites such as Motley Fool. One book that EVERY investor should read is "Where Are the Customer's Yachts" by Fred Schwed. In it, Schwed describes how the financial professionals view their customers. They basically treat their customers as sources of income. When at Motley Fool, read articles with the same title by Morgan Housel.

      As Bob E says “One must have the willingness, time, and interest”. The problem with new investors, or many investors for that matter, is that they are looking for instant gratification of making money right away. They skip on educating themselves about the basics of investing and fundamentals of the companies they invest in. Making money from investing or trading is a job, just like going to work. There are no shortcuts.

      Nobody is going to be as dedicated to and conscientious about your portfolio as you are.

    • Bob E
      May 17, 2015 at 9:25 pm

      Dragonmouth,
      Your reaction to Dann's concern was the same as mine; but I had decided to let it rest. However, ...

      As I noted earlier, BI has education programs. When I got started with them (through an investment club), I had ZERO experience with or knowledge about investing in individual stocks. (I had some reasonably successful self-taught experience with funds, but that is another story.) I will be completely willing to turn my portfolio over to an adviser, OR an 'canned' methodology as soon as I find one that will guarantee to meet or beat my results.

      Another book that may be of interest to folks is "Buying Stocks without a Broker" by Charles Carlson. It deals with companies that will sell stock directly to the investor. It was probably more important before the days of prevalent low-cost online fees, but ...

    • Dann Albright
      May 19, 2015 at 6:39 am

      Dragonmouth, Bob, you make good points. I hadn't really thought of it that way—yes, I do think that people should have professional advice before they get started. Of course, it's not a requirement, and as you point out, there are plenty of great resources if you're willing to put in a lot of time (especially for something like an investing course at a college).

      It all comes out to balancing your priorities. To get the maximum yield from your investment, you can take the time to take classes, read books, subscribe to sites like The Motley Fool—but if you're more interested in saving time and getting a slightly lesser gain, then an option like the ones discussed above might be a better way to go. It doesn't have to be about instant gratification; it can just be about making the most out of the amount of time that you're willing to allocate to it.

      Especially with how volatile the market can be (and has been in the past decade); if you don't know what you're doing, you can lose a lot of money fast.

      Anyway, I agree that becoming better educated is the optimal way to go. This article wasn't focused on that, though; it was focused on how you can get started without (or before, or while) gaining an education in trading.

      This has been a very enlightening conversation—thanks very much for your comments!

  4. Chinmay S
    May 14, 2015 at 9:43 am

    To earn money in the stock market, you have to do a lot of study. You just can't rely on a tool or website that says "If you start with X, we can help you grow it Y". If some website claims they can grow it to a number, they would be doing it themselves and not telling others their super secret formula.

    To become successful in stock market, you have to do homework. Read some good books and you will gradually learn about stock market. "How to make money in stocks" by William O'Neil is an excellent book.

    Even if you become the greatest trader of all time, you won't be able to guarantee that you will be making money all time. With the right knowledge, you will be able to earn good profit. Other person can only give you advice. You are the one who has to analyse everything. Without knowledge, stock market will wipe you out.

    • Bob E
      May 15, 2015 at 3:15 am

      Chinmay S
      Exactly right. I have added a full comment.

    • Dann Albright
      May 15, 2015 at 9:44 am

      I definitely agree with you that investing without understanding the market and how trading works is a bad idea, but I think that saying "if they knew how to do it, they would do it and not tell people their formula." These services aren't just selling investment advice, though, they're selling the convenience of having your money automatically put into the funds that have been (algorithmically) determined to be good bets based on your preferences. I think that's important to rememer; they're selling not just investment advice, but convenience, too.

    • Chinmay S
      May 15, 2015 at 11:24 am

      @Dann- No algorithm can ever determine if a stock would go up or down. There are indicators that tell when you can buy and when you should sell(Ex - RSI below 30 - oversold condition) but that doesn't mean indicators will be right all the time. For best results, technical analysis should be combined with fundamental analysis.

      You may have heard of Dan Zanger, he turned $10,775 into $18 million between June 1998 and December 1999, world record holder for largest percent change for a personal portfolio in just 18 months.
      His secret are his ten golden rules which you can find on his website.

      9th point from his 10 golden rules:
      "Many stocks are mentioned in the newsletter with buy points. However just because it's mentioned with a buy point does not mean it's an outright buy when a buy point is touched. One must first see the action in the stock and combine it with its volume for the day at the time that buy point is hit and take keen notice of the overall market environment before considering purchases."

      The point is you shouldn't give your money to some website and let them invest wherever their algorithms want to.

  5. ReadandShare
    May 13, 2015 at 11:41 pm

    Just to add another two cents...

    Yes, there's a huge amount of info out there. And with modern tech, it is also so easy to make changes -- that some newbie investors might fall into the trap of constantly "fine tuning" their portfolio -- buying and selling and then buying and selling some more... ad infinitum.

    Resist the temptation. Take your time to do your homework. Think through the 'what and why's' of your investments. Then trust the market (and yourself). Sure, be watchful. But also be patient. Selling at every market hiccup and constantly chasing the next 'winning' stock -- and you fall into the money-losing trap of "selling low and buying high". And a sure losing proposition.

    • Dann Albright
      May 14, 2015 at 6:35 am

      That's a great point about constant fine-tuning. With the instant access we have to our accounts, that's definitely a risk. That's one of the advantages of using services like these—they keep an eye on a number of factors and re-balance when it looks like it's a good idea. There's a lot of thought that goes into investing well (and the advice that you provide is very good).

      But when people are just starting out, and they want to get a few investments under their feet while they go about learning the ins and outs of basic trading, using a solution like the ones listed above can be a good idea. Getting to know the market and the trade is awesome, but not everyone can take the time to do that well.

      Thanks for your comment!

  6. dragonmouth
    May 13, 2015 at 10:43 pm

    "there’s a huge amount of information out there"
    There is a huge amount of MIS-information and DIS-information out there. There are qualification requirements to becoming a stock or a market adviser so the Internet is full of individuals talking out of all their bodily orifices other than their mouths.

    I am surprised that you dedicated all of four words to Motley Fool. It is true that Tom and David Gardner, the Motley Fools, used to write a financial blog when they were hosted by AOL. But when they started their own site (www.fool.com) it was as a full-service financial advice site. It is one of the best and least biased financial sites on the web. Most of the site can be accessed for free after registration. They do offer various subscription-only (paid) newsletters for more experienced investors. However, even without the newsletters there is great amount useful information for both beginners and advanced investors.

    If I am not mistaken most, if not all, SigFig content has to be paid for.

    "And, of course, you can always talk to a financial advisor."
    Do not forget that professionals do not offer their services for free. They make money from their customers making transactions. The more transactions made by the customers, the more money the advisors make. Financial advisors can be very expensive, even the low-priced ones.

    • Dann Albright
      May 14, 2015 at 6:32 am

      Motley Fool is a great website, but the focus here was on apps that will help you get started without requiring professional advice. It just seemed irresponsible to not recommend talking to a pro, though.

      I'm not sure what SigFig content you're referring to—their services are paid, like the other algorithmic options here. Did I miss something?

      I wasn't trying to imply that financial advice was free. They most certainly can be expensive, but sitting down with one for a session or two to make some plans that you can then put in place on your own could be a worthy investment.

      Thanks for your comment!

    • dragonmouth
      May 14, 2015 at 12:38 pm

      "learning from someone who’s done it before can’t be beat."
      Motley Fool is a site where you can (will) learn from someone who has done it before, both the writers and the posters.

      "Did I miss something?"
      No, apparently I did. I was not aware that the sites you mentioned are all pay-for sites. I avoid such sites, preferring to spend the money on actual investing rather than on advice. I prefer free sites such as Motley Fool and/or The Graham Investor.

      Anyone thinking of getting into investing should start by reading at least the following three books:
      The Intelligent Investor by Ben Graham
      Random Walk Down Wall Street by Burton Malkiel
      Learn to Earn by Peter Lynch
      Even experienced investors will find some sage advice in these books.

    • Bob E
      May 15, 2015 at 3:19 am

      Good books all. Motley Fool is also excellent and I agree with your general orientation. I added a comment later regarding BetterInvesting. One must join (pay if you will) to get everything from that source, but then the same is true of Motley Fool.

    • Dann Albright
      May 15, 2015 at 9:39 am

      Thanks for the book recommendations, dragonmouth! I definitely understand your preference to spend money on investing instead of advice; these sites can help you do that, if used how they're meant to.

      I'm not familiar with The Graham Investor, but I'll check that out!

  7. Hildy J
    May 13, 2015 at 9:59 pm

    I invested in individual stocks and options for decades. I followed Buffett's advice and invested in companies that I knew and in the company I worked for. Unfortunately, I worked in IT and I worked for MCI. Then the IT bubble burst and WorldCom happened. So much for retiring early.

    My strong advice to beginning investors is to NEVER buy a stock or bond unless you have to (because your company is subsidizing your purchases of its own stock).

    My second two decades I invested solely in three EFT equivalents offered by my 401k that mirrored major indices - the S&P 500, the total US stock market, and the large cap international market. When I rolled over to a self-managed IRA I bought actual EFTs that mirrored major indices (dropping the total market and picking up a mid cap and a small cap EFT).

    Find a discount brokerage with low or no fees and EFTs you can trade commission free.

    Start with one that tracks the S&P500 and work your way out from there. Decide what percentage you want in each EFT and invest it. Then sit back until you put more money in next month using the percentages you determined. If you want, once a quarter or once a year, rebalance (buy and sell) to bring the percentages back to your originals.

    If you're worried about a crash, don't invest in bonds, set up stop loss orders (which will sell your holding if the price drops below a certain point). Note that this is an advantage to EFTs - you can sell them in seconds.

    • Dann Albright
      May 14, 2015 at 6:29 am

      Thanks for all the great advice! That's the kind of information that comes with experience, which many of our readers don't have yet. And while algorithmic solutions work for many people, learning from someone who's done it before can't be beat.

    • Hildy J
      May 14, 2015 at 11:41 am

      Note - it's ETF (Exchange Traded Fund), essentially a mutual that is traded like a stock and not eft (a young newt in crossword puzzles).

      Stupid autocorrect.

    • Bob E
      May 15, 2015 at 3:39 am

      Hildy J - I disagree with some of your advice - especially about not buying individual stocks. A knowledgeable investor can do very well investing in individual stocks. I posted below more on this subject. Market 'crashes' can be disconcerting, but the biggest losers in those times are those MUST sell. I retired in 1998 at age 56, and only because of my investments. During the 2 years starting mid-Apr 2008, I sold 8.3% of my portfolio (most of that was a forced sale as BUD was bought out; the rest because I needed the cash for a home expansion). I made NO other transactions other than DRiP purchases. At the end of the two years, my portfolio was up over 21% (not excluding the sales).

      The message is: invest in what you know (as you quoted from Buffet); make your own (knowledge-based) decisions; buy growth stocks; buy and hold (another Buffet item, but mainly if you trade a lot the person who will get rich is your broker); learn how to analyze stocks (see later comment). Anyone is free to disbelieve this, but I started seriously investing in individual stocks in about 1991 and the annual growth rate (including dividends) of my (retained) portfolio [there are qualifiers on this, that would make the overall number a little bit lower] exceeds 18%..

  8. Hildegerd
    May 13, 2015 at 9:20 pm

    And you have Accorn as well, only for US citizens right now.

    • Dann Albright
      May 14, 2015 at 6:27 am

      Acorns looks like a great app! I actually included it in an article about savings that will be coming out soon. Another solid choice.

      Thanks for reading!

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