Learning how to invest money might seem scary, but it’s easier than you think, and you can start no matter how much you have saved.

Investing money in the stock market is the No. 1 way Americans build wealth and save for long-term goals such as retirement, but figuring out the best strategy to invest that money can feel daunting. This doesn’t have to be the case.

The best way to invest money: A step-by-step guide
Everyone has a unique financial situation. The best way to invest depends on your personal preferences along with your current and future financial circumstances. It’s important to have a detailed understanding of your income and expenses, assets and liabilities, responsibilities and goals when building a sound investing plan.

Here’s a five-step process that can help you figure out how to invest your money right now:

Identify your financial goals, timeframe and feelings about risk.

Decide whether you want to take a “do-it-yourself” or “manage it for me” approach.

Pick the type of investment account you’ll use (401(k), IRA, taxable brokerage account, education investment account).

Open an account.

Choose a combination of investments that match your risk tolerance and provide diversification (stocks, bonds, mutual funds, real estate).

And here are the details on how to put your cash to work in the right way, right away.

» Ready to start investing? Read about the best investments right now

1. Give your money a goal
Figuring out how to invest money starts with determining your investing goals, when you need or want to achieve them and your comfort level with risk for each goal.

Long-term goals: These goals are at least five years away. The universal goal is often retirement, but you may have others as well: Do you want a down payment on a house or college tuition? To purchase your dream vacation home or go on an anniversary trip in 10 years?

Short-term goals: These goals are less than five years away. This is next year’s vacation, a house you want to buy next year, an emergency fund or your Christmas piggy bank. Money for short-term goals generally shouldn’t be invested at all. If you need the money you’re saving in under five years, check out our recommendations for how to invest money for short-term goals.

In this post, we’re largely focusing on long-term goals. We’ll also touch on how to invest with no specific goal in mind. After all, the aim to grow your money is a fine goal by itself.

» Curious about buying stocks? Learn how to invest in the stock market.

2. Decide how much help you want
Once you know your goals, you can dive into the specifics about how to invest (from picking the type of account to the best place to open an account to choosing investment vehicles). But if the DIY route doesn’t sound like it’ll be your cup of tea, no worries.

Many savers prefer having someone invest their money for them. And while that used to be a pricey proposition, nowadays it’s quite affordable — cheap, even! — to hire professional help thanks to the advent of automated portfolio management services a.k.a. robo-advisors.

These online advisors use computer algorithms and advanced software to build and manage a client’s investment portfolio, offering everything from automatic rebalancing to tax optimization and even access to human help when you need it.

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