Investing basics for absolute beginners

The vocabulary, quickly

• Stock — a small ownership share in a company.
• Bond — a loan you make to a government or company that pays interest.
• Index fund / ETF — a single fund holding hundreds or thousands of stocks or bonds at once, so one company's bad year barely matters.
• Expense ratio — the annual fee a fund charges. Broad index funds often charge under 0.10%.

Why time matters more than timing

Compounding means your returns start earning returns. $200 a month at a 7% average annual return is roughly $34,000 after 10 years and roughly $245,000 after 30. The extra 20 years does most of the work.

A sane order of operations

1. Starter emergency fund in place.
2. Capture any employer retirement match — that's an instant return.
3. Pay off high-interest debt (roughly 8% APR and above).
4. Invest regularly in a low-cost, broadly diversified fund.

This is general education, not personalized investment advice. For decisions specific to your situation, talk to a fiduciary financial advisor.