Whether you are investing the first sliver of your first paycheck or a big chunk of money from winning the lottery, it can be a little scary. If you are afraid then invest like a grandma! Honestly, just start with the grandma portfolio by buying 25% stocks and 75% government bonds.
The blue line below is the portfolio and the red is the S&P 500 (the stock market). I used the Vanguard mutual funds VFINX and VUSTX tracked them from 1999 till 2019.
The blue line is much calmer and grows larger than the stock market. Grandma won all around! This is a very conservative portfolio, and someone using this portfolio could have easily ignored the troubles of the dot com crash or the housing bubble.
Even if you started this portfolio at the very worst time possible your account would have dropped by only -12%. Even if you were that unlucky it would only take a year or two for you to recover and get positive again.
If you are afraid to invest just start conservatively. Don’t try to be too aggressive. The biggest danger is that you don’t invest at all or don’t stay consistent. Take it easy and invest in a way that you can stick to. If you can only handle a 12% drop that is okay as long as you still invest your money.
To copy this portfolio just look for a broad stock market index fund and a long term government bond fund available through your account provider. Whether the next market crash comes from the trade war, the deficit, student loans, or anything else you want to make sure you are in a portfolio that will let you keep calm and invest on!