15 Ways to Start Investing in 2022

Are you ready to invest your money in the stock market for the very first time in 2022? If fears of a recession and harbingers of impending doom about investing in the stock market have made you hesitant to take the plunge, you're not alone.

But when you have an investment horizon of many years -- and only put your money into quality companies with stable financials, strong cash flows, and multiple avenues of growth ahead -- market volatility can be your friend, not your foe.

Whether you're ready to take the leap today or are planning on it soon, here are 15 ways to start investing in 2022.

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As with any financial move you make in life, you want to have a well-organized strategy when it comes to your investment portfolio. For the individual retail investor, time and patience are two of your most vital assets.

What does this mean in practice? Well, as a long-term investor, you should be committed to holding any company you invest in for no less than three to five years -- or ideally, longer than that. An important strategy to balance out the level of risk in your portfolio and maximize its ability to realize growth is to allocate your capital across multiple types of investments and industries.

You also want to determine the type of investing style and approach that works best for you. Are you comfortable putting your money into companies with more rapid growth profiles that may also carry more short-term risk? Or do you like to stick with more established investments that will lend enhanced stability but slower growth to your portfolio? What are your short- and long-term investing goals? How much money do you have to invest?

Also ask yourself: Will you have the time to take a more active or passive approach to investing? This will determine whether you're better suited to investing in more readily diversified assets like mutual funds, index funds, or exchange-traded funds, as opposed to focusing primarily on individual stocks.

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In order to invest in the stock market, you’ll need to sign up for a brokerage account to enable you to buy and sell the companies you're interested in. There are online stock brokers for every type of investor and investing need. In addition to allowing you to invest in individual stocks, funds, cryptocurrency, and more, many of these also allow commission-free trading with no account minimums.

Fractional investing can be an exceptional tool for investors of all experience levels. Most online stock brokers today will allow you to buy partial shares of a stock. In particular, if you're a new investor, fractional investing has the dual benefit of enabling you to diversify your holdings more rapidly while also making use of even a relatively modest amount of starting capital.

And even if you have a generous amount of cash to invest starting out, with some top stocks running hundreds of dollars or more for a single share, you can leverage a tool like fractional investing as a means of becoming a part owner of companies with large valuations while still achieving balance in your portfolio.

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The types of companies and industries you add to your portfolio will very much depend on your investing style and your interests. From tech to consumer goods to consumer staples to healthcare and beyond, the market is abundant with opportunities for every type of investor. Invest in what you like and what you're interested in, and never invest in a business unless you fully understand it and are committed to holding it in your portfolio for at least several years.

Investment funds like mutual funds or index funds are a great way to quickly expand your holdings into a variety of stocks and sectors. And you can do so even with a fairly small amount of investing capital.

If you're just starting out and only have a few hundred dollars to invest, funds can help you rapidly achieve exposure to many different types of companies and provide a solid foundation for you to build on over time as you continue to add more money into the stock market and broaden your portfolio.

5 Stocks Under $49
Presented by Motley Fool Stock Advisor
We hear it over and over from investors, “I wish I had bought Amazon or Netflix when they were first recommended by The Motley Fool. I’d be sitting on a gold mine!" It's true, but we think these 5 other stocks are screaming buys. And you can buy them now for less than $49 a share! Click here to learn how you can grab a copy of “5 Growth Stocks Under $49” for FREE for a limited time only.

Your level of risk tolerance will be a significant determining factor in the types of investments you hold in your portfolio. Investors with a higher aversion to risk often prefer more value-oriented companies, while those with a higher tolerance for risk often gravitate toward growth-oriented businesses. Many of the most profitable portfolios feature a variety of companies from both camps.

Nevertheless, it’s important to determine the nature of the businesses that you’re comfortable investing in from the beginning and allocate your capital accordingly.

You’ll want to keep an eye on the balance of your portfolio to ensure that your current allocation still aligns with the level of risk you prefer. Also bear in mind that as you gain more experience, you may find that your aptitude for time is higher than at the beginning of your investing journey, and may decline again as you get closer to retirement.

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If you're brand new to investing and aren't sure where to start, the good news is you don't have to start big. In fact, as a new investor, you shouldn't be investing all your cash into the stock market. There's nothing wrong with starting small and working your way up.

One of the primary long-term goals most investors have in building a portfolio is to save for a comfortable and profitable retirement. Investing in quality stocks is certainly one key piece of the puzzle to building a diversified portfolio, but it's not the only one. Through employer-sponsored plans like a 401(k), you can build a robust retirement nest egg to provide you with multiple streams of income in the future on top of your stock investments.

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You never want to have all your cash in stocks. While the stock market is a fairly liquid place, if an emergency happens or you simply need cash for one reason or another, you don't want to have to dip into your portfolio at an inopportune time to access that money.

In addition to building a well-diversified investment portfolio, you should always ensure that you have a solid nest egg set aside separate from that. The good news is, you can make your nest egg money work for you, too, particularly if you deposit it into a high-yield savings account.

Debt -- especially bad debt like high-interest loans or credit card debt -- can be poisonous to your financial health. From impacting your ability to save or invest to causing tremendous financial hardship and stress, you never want to sit on debt if you can help it.

You don't have to be free of all debt before you invest. That being said, if it can't afford to do both for a time, focus on ridding yourself of high-interest debt before you add to your portfolio.

Never invest money that you think you're going to need soon, as doing so could force you to pull from your portfolio well before you otherwise would and risk taking on losses.

5 Stocks Under $49
Presented by Motley Fool Stock Advisor
We hear it over and over from investors, “I wish I had bought Amazon or Netflix when they were first recommended by The Motley Fool. I’d be sitting on a gold mine!" It's true, but we think these 5 other stocks are screaming buys. And you can buy them now for less than $49 a share! Click here to learn how you can grab a copy of “5 Growth Stocks Under $49” for FREE for a limited time only.

In addition to working on paying down debt, another aspect of a solid financial strategy that can impact your ability to invest is an emergency stash -- or the lack of one. Your emergency stash should really only be for emergency situations, and in a perfect world, contain at least six months or more of expenses in case an event like a job loss were to occur.

You may rarely need to tap into your emergency fund. However, if you don't have one, your investment portfolio could take a substantial negative impact if you have to turn to it instead as a source of much-needed cash in a dire moment.

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Whether it's birthday cash, a tax refund, or payment for your side hustle, don't let that money sit by doing nothing for you. Whenever you have extra money come your way, consider it as a way to continue to upgrade your financial health. This could be as simple as investing it in the stock market or using the money to pay down outstanding debt.

The way you allocate your money into various investment assets may look very different from the way someone else does, and there's nothing wrong with that. Your financial goals -- and your portfolio goals -- are extremely personal to you, your income, your spending and saving needs, and intended retirement outcomes. Just because a stock represents a great company to invest in doesn't mean it's the right investment for you.

ALSO READ: 3 Proven Ways to Double Your Money

While there's certainly such a thing as over-diversification, a measured approach to buying different types of stocks for your portfolio from the beginning can serve you well with the passage of time.

As you learn about and invest in businesses, continue to follow the trajectory of their growth, stay up-to-date on earnings, and pay attention to what leadership is doing. By keeping up with the companies you own, you can both ensure that your portfolio balance is where you want it to be and is taking you in the direction of both your short- and long-term financial goals.

There are several ways to invest in assets that produce generate consistent dividends. Dividend stocks are a popular route and can be found across a variety of sectors. Other than individual stocks, investment vehicles like mutual funds, exchange-traded funds, and real estate investment trusts are known for being consistent dividend payers.

5 Stocks Under $49
Presented by Motley Fool Stock Advisor
We hear it over and over from investors, “I wish I had bought Amazon or Netflix when they were first recommended by The Motley Fool. I’d be sitting on a gold mine!" It's true, but we think these 5 other stocks are screaming buys. And you can buy them now for less than $49 a share! Click here to learn how you can grab a copy of “5 Growth Stocks Under $49” for FREE for a limited time only.

Your ability to build a profitable portfolio isn't just about how much money you put in the stock market. It's also about how much time you put in the stock market. As a long-term investor, you can maximize the impact of staying in the market through its ups and downs by make investing a regular part of your life.

Some investors prefer to buy new stocks every week, others in bulk every quarter, while still others take a piecemeal approach. An easy way to ensure you're investing consistently is to set aside a specific dollar amount of money every single month to invest, and to keep putting that money into great companies that you love and are willing to hold for many years.

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