Welcome to Catalyst
Your launchpad for investing.
A product of The Finance Lab
Let's be real for a second. Nobody teaches you this stuff in school. You learn about the mitochondria (the powerhouse of the cell — thanks, biology) but not about the one thing that will quietly shape your entire adult life: what you do with your money.
Right now, you might have some cash in a savings account. That's great for emergencies — seriously, keep that. But here's the thing your bank isn't rushing to tell you: a typical savings account pays about 0.01% interest. That means $1,000 sitting there for a whole year earns you… ten cents. A dime. You can't even buy a gumball with your "gains."
Meanwhile, inflation — the thing that makes everything cost more over time — runs around 3% per year. So your savings account isn't growing your money. It's slowly shrinking it. Your $1,000 buys a little less next year, and a little less the year after that.
Savings accounts are for money you need soon — rent, emergencies, that car repair you didn't see coming. They're your financial seatbelt.
Investing is for money you're growing for the future — goals, dreams, and the kind of freedom that lets you make choices on your own terms. That's what Catalyst is about.
This app is going to walk you through the whole thing — no finance-bro jargon, no condescension, no sales pitch. Just the stuff you actually need to know, explained like a friend who's been doing this for 20 years and wants to save you from the mistakes they made.
You don't need to be rich to start. You don't need to be a math person. You just need to start — and starting is exactly what we're about to do.
⚡ What Could Starting Now Mean For You?
Drag the slider to see what happens when you invest a little each month — starting today.
You'd only contribute $24,000 over 40 years. The rest is compound growth.
Assuming ~9% avg annual return (S&P 500 historical average)
Getting Started
Your first steps don't need to be big — they just need to happen.
Why Start Now?
Here's the thing nobody tells you at 18: the single biggest advantage you will ever have as an investor isn't intelligence, connections, or even money. It's time.
If you invest $200/month starting at age 18, by 65 you'll have roughly $1.1 million (at a 10% average annual return). Wait until 28? You'll end up with about $500k. Same monthly amount — half the result — just because of 10 years.
You don't need to know everything. You don't need a lot of money. You just need to start.
Account Types — The Short Version
Think of accounts like different types of garden beds. They all grow plants, but the rules about watering (deposits) and harvesting (withdrawals) are different.
| Account | Tax Perk | 2025 Limit | Best For |
|---|---|---|---|
| Roth IRA | Grows tax-free. Withdrawals in retirement = $0 in taxes. | $7,000/yr | Young people (you're likely in a low tax bracket now) |
| Traditional IRA | Tax deduction today; pay taxes when you withdraw. | $7,000/yr | Higher earners wanting a tax break now |
| 401(k) | Employer often matches your contributions (free money!). | $23,500/yr | Anyone with an employer match |
| Brokerage | No special tax perks, but no withdrawal rules either. | No limit | Saving for goals before retirement |
🏦 Before You Even Pick Stocks: The Risk-Free Upgrade
Remember how we said your savings account pays about 0.01%? Here's why opening a brokerage account is worth it even if you never buy a single stock:
💰 Money Market Funds
A money market fund holds ultra-short-term debt from the government and large corporations. Your money is essentially as accessible as a savings account, but the yield is dramatically better.
SWVXX — ~3.51% yield
vs. your bank's 0.01%
That's 350x more than a typical savings account. On $5,000, that's ~$175/year instead of 50 cents.
🇺🇸 Treasury Bills (T-Bills)
T-Bills are short-term loans to the U.S. government — 4 weeks, 13 weeks, 26 weeks, or 1 year. The government borrows your money and pays you interest. Currently yielding in the 4%+ range.
The same entity behind FDIC insurance
You can buy T-Bills through your brokerage or directly at TreasuryDirect.gov. They're exempt from state and local taxes, too.
Money market funds aim to maintain a $1.00 share price and have an extremely strong track record, though they aren't technically FDIC-insured. In practice, the risk of loss is near zero — major money market funds have "broken the buck" (dropped below $1) only twice in history, and new regulations since 2016 have made government money market funds even safer. T-Bills are backed by the full faith and credit of the U.S. government — the same guarantee behind FDIC insurance itself. If the U.S. government can't pay its T-Bills, FDIC insurance wouldn't mean much either.
🎯 Add to Your Plan
Choose what resonates — these build your personal plan.
How to Open an Account
It takes about 15 minutes online. Here are three well-regarded brokerages — all free to open, no minimums, no commission on stock/ETF trades:
Great research tools. Fractional shares. Zero-fee index funds.
Excellent customer service. Strong all-around.
The OG. Built by Jack Bogle. Investor-owned.
Schwab currently offers a Starter Kit™ — fund a new account and get $50 in fractional shares to get started. Nice way to plant your first seeds with a little bonus soil. (Subject to change — check Schwab's site for current details.)
Auto-Invest: Your Secret Weapon
Here's a pattern that will serve you for decades: set up an automatic monthly transfer into your investment account, and automatic purchases of a broad index fund.
Why? Because the biggest threat to your investment returns isn't a market crash — it's you. Humans are emotional. We panic-sell at bottoms, get greedy at tops, and constantly second-guess ourselves.
Automation removes emotion from the equation. The money goes in whether the market is up, down, or sideways. Over time, that consistency is worth more than any clever market timing.
Account Types — Deeper Dive
| Feature | Roth IRA | Trad. IRA | 401(k) | Brokerage |
|---|---|---|---|---|
| 2025 Contribution Limit | $7,000 ($8,000 if 50+) | $7,000 ($8,000 if 50+) | $23,500 ($31,000 if 50+) | Unlimited |
| Tax on Contributions | After-tax (no deduction) | Pre-tax (deductible) | Pre-tax (deducted from paycheck) | After-tax |
| Tax on Growth | Tax-free | Tax-deferred | Tax-deferred | Taxed (dividends, cap gains) |
| Tax on Withdrawal | $0 (qualified) | Ordinary income tax | Ordinary income tax | Capital gains tax |
| Early Withdrawal | Contributions anytime; earnings have 10% penalty before 59½ | 10% penalty before 59½ | 10% penalty before 59½ | No restrictions |
| Income Limits | Phaseout at $150K-$165K (single) | Deduction phases out with 401(k) | No income limit | None |
| RMDs | None | Age 73 | Age 73 (unless still working) | None |
If your income is too high for direct Roth contributions, you can contribute to a Traditional IRA (non-deductible) and then convert it to a Roth. This is the "backdoor Roth" — perfectly legal. Just watch the pro-rata rule if you have other pre-tax IRA money.
Brokerage Selection: What Actually Matters
Commission-free trading is standard now, so the real differentiators are: fund selection and expense ratios, research tools and interface quality, fractional share availability, tax-lot accounting options, and customer service quality.
All three major brokerages (Fidelity, Schwab, Vanguard) are excellent. Schwab is currently offering a $50 Starter Kit for new accounts. The choice rarely matters as much as people think — pick one and go.
Auto-Investing Strategy
Beyond basic automation, consider structuring your contributions based on the "waterfall" method: (1) 401(k) up to employer match, (2) Max out Roth IRA, (3) Back to 401(k) toward max, (4) HSA if eligible (triple tax advantage), (5) Taxable brokerage for anything beyond.
Each account gets its own automatic contribution, its own target allocation, and its own rebalancing cadence. Once you set this system up, you interact with it maybe twice a year. That's the goal.
📋 Where Are You Right Now?
Quick check-in — this shapes your personalized plan at the end. Be honest, no judgment.
Know Yourself
Your portfolio should fit your personality — not someone else's.
Why This Matters
The "best" investment strategy is the one you can actually stick with. If aggressive growth makes you lose sleep, you'll sell at the worst possible time. If ultra-conservative makes you bored and you start chasing meme stocks, same problem.
Let's figure out where you land.
Risk Tolerance vs. Risk Capacity
There's a useful distinction here. Risk tolerance is psychological — how much volatility can you handle emotionally? Risk capacity is financial — how much can you afford to lose without derailing your goals?
A 22-year-old with a 40-year horizon has massive risk capacity even if their tolerance feels low. The quiz below focuses on tolerance. Your time horizon (covered next) shapes your capacity.
🧭 Risk Tolerance Quiz
Answer honestly — there's no "right" answer. This is about self-knowledge.
🎯 Set a Goal
Investing works best when you know what you're growing toward.
⏳ Time Horizon = Risk Capacity
The longer your runway, the more short-term bumps you can absorb. Here's how investment professionals typically think about it:
If you're 18 and investing for retirement, your horizon is 40+ years. You can afford to ride out every storm.
Pick Your Investments
You don't need to pick the perfect stock. You need to own the whole garden.
The Big Four Investment Types
An index fund tries to match a whole market. When you buy a total stock market index fund, you own a tiny piece of every major company in America — Apple, Walmart, your local bank, all of them.
Why this is great: you don't have to pick winners. If one company tanks but another doubles, the fund absorbs both. Over long periods, the overall market has always gone up (roughly 10% per year historically, before inflation).
Example: A total stock market index fund (like VTI or FSKAX) gives you exposure to 3,000+ companies for an annual fee of about 0.03% — that's 30 cents per $1,000 invested per year.
ETFs (Exchange-Traded Funds) hold the same baskets of stocks or bonds that index funds do, but they trade throughout the day like individual stocks. Mutual fund versions of index funds only trade once a day at market close.
For most young investors, the practical difference is small. ETFs are slightly more tax-efficient in taxable accounts, and you can buy fractional shares of most ETFs. Popular ones: VTI (total US stock market), VXUS (international stocks), BND (bonds).
Buying individual stocks means you're betting on specific companies. This can work — Buffett made billions doing it. But here's the honest truth: most professional fund managers fail to beat the market over 15+ year periods.
If you do want to pick stocks, a good rule is the "90/10" approach: put 90% in broad index funds and use 10% as a "play" portfolio for individual picks. That way you satisfy the curiosity without betting your future on one company's earnings report.
When you buy a bond, you're lending money to a government or company. They pay you interest, then return your money at a set date. Less exciting than stocks, but they cushion your portfolio during crashes.
At your age? You probably don't need many bonds. Maybe 10% or less. As you age and your time horizon shrinks, you'll gradually increase bonds — that's what "rebalancing" means (we'll cover it in The Long Game).
Index Construction & Weighting
Not all index funds are equal. Most popular funds are market-cap weighted, meaning bigger companies get more weight. The S&P 500 is currently top-heavy — the largest 10 companies make up roughly 30-35% of the index.
Alternatives include equal-weight indexes (each company gets the same slice), factor-based funds (targeting value, momentum, or quality), and fundamentally-weighted indexes. For most people, standard cap-weighted total market funds remain the best default.
US stocks have outperformed international markets for the last 15 years. Before that, international outperformed for a decade. A 60/40 or 70/30 US/International split gives you exposure to both without taking a strong directional bet.
💸 The Fee Drag: Why 1% Is a Big Deal
Fees look tiny on paper. But compounded over 30 years, they eat an enormous chunk of your money. Here's $10,000 invested with 8% annual return:
That's nearly 23% of your ending balance — gone to fees, not to you. And that's on just $10k. On a $500k portfolio over 30 years, a 1% fee costs over $350,000. This is why Bogle and Buffett are so obsessed with low fees.
📅 Dollar-Cost Averaging (DCA)
Instead of investing a lump sum all at once, DCA means investing a fixed dollar amount at regular intervals — like $200 on the 1st of every month, regardless of prices.
Here's a simplified example of investing $200/month over 5 months while the price fluctuates:
| Month | Share Price | You Invest | Shares Bought |
|---|---|---|---|
| Jan | $50 | $200 | 4.00 |
| Feb | $40 | $200 | 5.00 |
| Mar | $33 | $200 | 6.06 |
| Apr | $45 | $200 | 4.44 |
| May | $50 | $200 | 4.00 |
| Total | Avg: $43.24 | $1,000 | 23.50 shares |
You invested $1,000 total and got 23.50 shares. Your average cost per share is $42.55, which is lower than the simple average price of $43.60. That's because you automatically bought more shares when prices were low. DCA works in your favor over time without you having to think about it.
🔄 Dollar-Cost Averaging: Your Autopilot
Invest the same amount on the same schedule, regardless of what the market is doing. When prices are high, you buy fewer shares. When they drop, you buy more. Over time, this averages out your cost — and stops you from trying to "time" the market (which even professionals can't do).
📑 What About Bonds?
A bond is basically an IOU. You lend money to a company or the government, and they promise to pay you back with interest on a set schedule. Think of it like a binding agreement — you know exactly what you're getting and when.
Here's the key difference between stocks and bonds: if a company goes bankrupt, bondholders get paid first from whatever assets remain. Stockholders? They're last in line and often get nothing. That's why bonds are considered safer — you're not betting on the company's success, you're just lending them money with a legal contract to be repaid.
The trade-off? Bonds return less over time. Stocks historically return ~10%/year; bonds more like 4-5%. Young investors usually want mostly stocks (more time to recover from drops), adding more bonds as they get older and closer to needing the money.
🎯 Add to Your Plan
Lock in your investing principles.
The Danger Zone
The investing world is full of people trying to separate you from your money.
🎰 FOMO Investing
When someone posts 500% gains on a meme stock, your brain screams "I need in!"
Reality: you're seeing survivorship bias. The 5 people who won are posting screenshots. The 500 who lost the same bet are silent. This is how casinos work.
🐍 The Modern Snake Oil Salesman
They have podcasts and blue checkmarks now, but the pitch hasn't changed:
"Only $497 for my course" · "Guaranteed returns"
If they're guaranteed to make money, they wouldn't need yours.
If the strategy actually worked, they'd use it quietly — not sell courses about it.
No legitimate investment guarantees returns. Anyone who says otherwise is lying.
📱 Speculating ≠ Investing
| Investing | Speculating / Gambling |
|---|---|
| Based on fundamentals and long-term value | Based on hype, momentum, or "feelings" |
| You can explain why you own it | You own it because someone told you to |
| You'd hold through a 30% drop | You'd panic and sell |
| Boring and slow — that's the point | Exciting and fast — that's the trap |
⏰ Other Traps to Avoid
70-90% of day traders lose money. The profitable ones have institutional-grade technology you don't have access to.
Borrowing money to invest amplifies losses too. You can lose more than you put in and owe your brokerage the difference.
Complex, time-sensitive contracts. Most beginners who trade options lose money. Worse odds than a casino.
Many are paid to promote products or pump their own holdings. Their interests are not aligned with yours.
💊 The Antidote
Invest in what you understand. Keep it simple. Keep it boring. Keep it consistent.
The slow path IS the fast path.
🛡️ Add Guardrails to Your Plan
Protect yourself from future you.
The Storm Shelter
When the market shakes you, come here. Breathe. Read. Remember the plan.
What are you feeling right now?
Calculators
Numbers make the abstract concrete. Play with these.
📈 Compound Growth Calculator
See how starting age and monthly contributions shape your wealth. Adjust the sliders and watch the gap.
🎯 Goal Tracker Calculator
Enter your goal and see what it takes to get there.
⚡ Life Stage Growth Calculator
Real life isn't a flat monthly payment. Your contributions AND risk tolerance change as your career grows.
When you're young with decades ahead, you can be 100% stocks (historically ~10%). As you age, you shift to bonds/stable investments for safety — lower returns but less volatility. This is how real financial planning works.
🗺 My Investment Plan
Everything from Catalyst, distilled into an action plan and investment philosophy.
Complete the sections above to build your plan
As you take the quiz, set goals, and run calculators, your personalized plan builds here.
📋 Action Plan
Step-by-step: what to open, where, how much, and how to automate.
🧭 Philosophy
Your risk profile, principles, and quotes to keep you grounded.
📚 Go Deeper
Curated free and low-cost resources for beginning investors.
📖 Books
The best first investing book. About behavior, patience, and how money really works. Short chapters, no jargon.
The legendary Fidelity fund manager explains how everyday people can spot great investments by paying attention to the world around them. Entertaining and practical.
By the founder of Vanguard. The most important argument for low-cost index investing ever made.
📝 Howard Marks' Memos
Howard Marks has written free investing memos since 1990. Buffett says: "When I see memos from Howard Marks, they're the first thing I open." Now also available as a podcast.
🎓 Free Learning
The Wikipedia of finance. Look up any term — plain English with examples.
Free video lessons on compound interest, stocks, and more. Great for visual learners.
Community of index fund investors. One of the best free investment education wikis online.
More resources coming soon. Have a suggestion? Let your teacher know.