Beginner Investor Statistics (2026)

The pandemic pulled a wave of first-timers into the market. In the FINRA Foundation's 2020 study, 57% of investors had opened a new taxable account that year, and 66% of those account-openers were true first-time investors who had never held a taxable account before (see the table below).

That surge has since cooled. By the 2024 wave of FINRA's National Financial Capability Study, only 8% of investors had started in the prior two years, down sharply from 21% in 2021, and young-adult ownership of non-retirement investments slipped from 26% to 21%.

Each generation starts younger than the last. In Schwab's 2024 Modern Wealth Survey, Gen Z reported beginning to save and invest at an average age of 19, versus 25 for Millennials, 32 for Gen X, and 35 for Boomers (see the chart below). Gen Z now starts roughly half as old as Boomers did.

Earlier starts pair with earlier exposure: 43% of Gen Z said they learned about investing at a young age, and 28% were taught about investments in school, versus just 9% of Boomers. Gen Z was also the most confident generation about its investing strategy, at 71%.

First-time investors skew young, diverse, and lower-income. In the 2020 wave, about 66% of New Investors were under 45, and only 16% were 60 or older, versus 45% of long-time account owners (see the tables below). Almost 40% of New Investors were aged 30 to 44.

They were also more diverse than established investors: 17% of New Investors were African American and 15% Hispanic or Latino, compared with 7% and 13% among holdover account owners. And 24% of New Investors earned under $35,000, reflecting that many entered with modest means.

The barriers that once kept people out have fallen, and that shows in the reasons beginners give. When asked their single main reason for opening a 2020 account, New Investors cited saving for retirement (17%), being able to start with small amounts (16%), and market dips that made stocks cheaper (12%) (see the chart below).

Emotion and social nudges matter too: 9% opened an account because they did not want to miss out, and 13% were prompted by a friend or family suggestion. Across multi-select reasons, the ability to invest with a small amount of money topped the list at 35%.

Beginners reach for individual stocks first. Among 2020 New Investors, individual company stocks were by far the most-traded type at 64%, ahead of mutual funds (28%) and ETFs (25%) (see the chart and table below). Alternatives such as crypto and gold came in at 15%.

That stock-picking tilt is notable because diversified funds are generally the lower-risk entry point. New Investors used options least among the group (6% versus 10% for experienced entrants), so complex derivatives were not the beginner's typical starting place, even during a speculative year.

Small balances are the norm. A third of New Investors (33%) held less than $500 in their new account, and among all investors aged 18 to 29 that figure rose to 41% (see the table below). Only about one in ten New Investors held $25,000 or more.

Low-minimum and fractional-share accounts make this possible: 33% of New Investors had bought fractional shares, and 54% funded their account from a regular paycheck. The low starting bar is a feature, but it also means small mistakes and fees can loom large against a tiny balance.

New investors learn differently from veterans. In the 2020 study, New Investors most often relied on friends and family (38%) and their own reading of company reports (37%), while only 23% leaned on financial professionals, versus 48% of long-time account owners (see the table below).

Social media already registered at 14% for New Investors, roughly double the 6% among established owners, and online chats added another 10%. Investment knowledge was lowest among New Investors on both self-assessed and objective measures, so who they listen to matters a great deal.

For younger beginners, the feed is the classroom. In the 2024 wave, 60% of investors aged 18 to 34 used social media for investment information, versus just 9% of those 55 and older, and 61% of the younger group acted on a social-media personality's recommendation versus 6% of the older one (see the table below).

That reliance carries risk. CFA Institute research found only about 20% of finfluencer posts that contained an investment recommendation included any disclosure, and roughly a third of Gen Z and Millennials say they check the credentials of the people giving them advice (CFA Institute).

Confidence outruns knowledge. On a five-question quiz, New Investors averaged just 1.4 correct, below both experienced entrants (2.3) and holdover owners (1.8), and 38% rated their own knowledge as low or very low (see the table below). A broader 2024-wave quiz put the average investor at only 5.3 of 11 correct.

Awareness gaps compound the problem: 48% of all investors did not know whether their account allowed margin, and 38% of New Investors did not know whether their account charged trade commissions. Among people who did trade on margin, 75% missed a basic margin question.

Beginners are active and mobile-first. In 2020, 61% of New Investors made at least one trade per month, and nearly half (48%) accessed their account primarily through a mobile app, versus 75% of long-time owners who used a website. The plurality of New Investors checked their holdings a few times a week.

Frequent checking can feed frequent trading, which research consistently links to worse returns. New Investors also planned short holding periods: 29% expected to hold one to three years, and 25% did not know how long they would hold, a sign that many started without a clear plan.

New investors are not uniformly reckless, but the tails are risky. In 2020, New Investors most often reported willingness to take only average risk (40%), and 9% were unwilling to take any risk, the highest of any group. Yet a speculative streak ran alongside caution: 29% listed speculating as a goal.

The younger cohort concentrates the risk-taking. In the 2024 wave, 43% of under-35 investors had traded options and 22% had bought on margin, versus 10% and 4% of those 55 and older, and 29% of under-35s had held a meme stock. High-risk tools cluster among the newest, youngest entrants.

The data points to a familiar cluster of beginner errors: overconcentration in a few hot stocks, trying to time the market, and panic selling in downturns. Widely cited DALBAR research found the average equity investor trailed the S&P 500 by close to four percentage points a year over two decades, driven mainly by emotional buying and selling (secondary/derived, DALBAR).

Market timing is especially costly. J.P. Morgan's long-running analysis shows an investor who missed just the 10 best market days over 2003-2022 would have ended with roughly half the return of someone who stayed fully invested. For beginners with tiny, undiversified balances, these mistakes hit hardest.

Zoom out and young adults still trail on ownership. Gallup polling puts overall US stock ownership at about 62% in 2024 and 2025, but only 31% of adults aged 18 to 29 own stock, versus 62% of those aged 30 to 64 (Gallup).

So the story is two-sided: younger people start investing earlier than any prior generation, but a large share still have not started at all. The beginners who do enter are younger, more diverse, and more digitally guided than the investors who came before them, which is exactly the audience most in need of good tools and plain guidance.

If you are new, the statistics carry a clear lesson: the biggest risks are not the market itself but overconcentration, over-trading, and following unvetted tips. Starting small is fine, but a single stock picked from a video is where beginners most often go wrong. Diversification and a written plan are the antidotes.

A practical starting point is to define your thesis before you buy, spread money across several positions rather than one, and check in on a schedule instead of reacting to every move. Walnut is built around that discipline: you set target weights for a basket, then place real trades toward those targets, which is a structured alternative to chasing whatever is trending in your feed.