According to Tori Dunlap This Big Mistake Is Super Common Among New Investors

Invest it or move it -- but don't let it just sit there.

Starting anything new tends to come with a learning curve. But when that new thing is something as complex as learning how to invest -- well, that curve can feel more like a cliff.

Thankfully, there are a ton of resources out there for new investors. And that includes a lot of experts happy to share their advice and experiences. For example, Tori Dunlap, author of Financial Feminist, is a seasoned investor who shares tips and tricks through her books, podcast, and website.

According to Dunlap, new investors tend to make a lot of the same mistakes. The most common? Failing to properly invest their retirement savings.

Saving money is only the start

At this point, most of us know we're supposed to put some of our money into a retirement account each year (or, ideally, each paycheck). For those with a traditional employer, this is made even easier as they'll usually do it for you -- often with an employer match.

But putting your money into your 401(k) or IRA is only half the battle. Once it's there, you have to actually do something with it. And that's where new investors often fall short, Dunlap says.

"What's the most common mistake I see first-time investors make? Putting their money in a Roth IRA and not actually investing it," she wrote in a tweet. "I call this financial purgatory. Don't let this be you."

Cash in an investment account loses value

Putting cash into your investment account gives you exactly that: cash, which happens to be in an investment account. And it will stay that way until you go into your account and put that money to use by investing it.

The exception? Folks who have an account that is actively managed by a stock broker. This may mean you have a human broker or it could mean an account managed by a robo-advisor. In either case, you're paying extra to have a third party handle your investments on your behalf.

So, why is it so important to invest the cash in your retirement account? Because cash doesn't grow. If you haven't invested it in stocks, bonds, mutual funds -- something -- then you're not getting any of the benefits of that investment. In other words, your money isn't growing.

In fact, your cash is actually losing value as it sits there -- especially these days. Why? Inflation.

As inflation increases, the purchasing power of your cash decreases. If it isn't earning you more money through investments, it's simply going to keep depreciating in value.

Inflation versus a down market?

Looking at the upheaval in the stock market this year, you may be thinking that you're better off with cash than with investing in a market that seems to keep dropping. But the data isn't so sure.

Inflation is high. The current rate is up 8.3% over the last 12 months. In practical terms, this means your cash is worth 8.3% less than it was the same time last year. Depending on how you've invested during that time period, your investments could be down more -- or they could have lost less value than the cash you have sitting around.

Of course, that's the short-term outlook. Investing is a long game. And over the course of decades, the stock market has historically offered a return that not only outpaces inflation, but also grows wealth.

Is growth guaranteed? No, of course not. But nothing in life is truly guaranteed (with the proverbial exceptions of death and taxes).

If you're absolutely certain you want to hold onto your savings as cash rather than invest them, that's your choice. But your investment account isn't the place for that cash. Instead, put it into a high-yield savings account or checking account. You still won't outpace inflation at its current rate, but at least you won't be losing quite as much value to it.