29% Of Gen Z Think The Stock Market Is Intimidating. Why It’s Not So Scary

The stock market can be a scary place. It can feel like inexperienced investors don’t stand a chance against high-powered traders, and well, there’s the constant up and down of stocks. So it’s not surprising that young American investors cited intimidation as one of the top reasons they didn’t pick the stock market as their top long-term investment over the next decade in Bankrate’s 2025 Long-Term Investment Survey. 

In total, 21 percent of Americans say the stock market is not their top investment choice over the next decade or longer because they’re intimidated by it. Young Americans feel that intimidation even more: 29 percent of Gen Zers (ages 18–28) and 24 percent of millennials (ages 29–44) cited that reason. In contrast, just 14 percent of Gen Xers (ages 45–60) and 22 percent of baby boomers (ages 61–79) named intimidation as their top reason. In total, intimidation was the second-most popular reason, while too much volatility scored the top spot.

Unquestionably, the stock market can be scary, but individual investors have ways they can succeed — and in fact, they can end up beating more than 90 percent of investors, even the pros. It’s not about having tons of knowledge but rather the right strategy and a steady hand.

Here’s how to make the stock market less scary for individuals.

How to take the fear out of investing in stocks

Investing in the stock market can feel daunting because it’s not always clear how individuals can succeed. But investors have some notable advantages over powerful and well-informed Wall Street traders, and they just need to focus on where they have these key strategic advantages.

1. Acknowledge that people play different games in the stock market

One of the first things to know about the stock market is that a variety of players are all playing their own games and using the market for different purposes. A few of these players include:

• Investors: Investors invest for longer periods of time, even decades, with the intent to make money on the success of a business.
• Traders: In contrast to investors, traders may hold positions for only days, minutes or even seconds. They try to make small amounts of money on the change in the market’s sentiment over short periods.
• Investment banks: Investment banks are looking to make money by issuing securities such as stocks (through IPOs, for example) and bonds to the market, and so they need to convince companies to sell those securities and investors to buy them.
• Companies: Companies may want to expand and so they may issue stock or bonds to do so. They also may want to acquire another publicly traded company for strategic reasons, and so they may choose to purchase all the existing shares of the company. 

As an individual, you can participate as a long-term investor or a short-term trader.

2. Play a game you know you can win

With so many different players in the stock market playing so many different games, it can be easy to think that individual investors have no advantage and are at the total mercy of others. But that’s not completely true — it all depends on the game you decide to play.

Consider this: A cheetah can reach speeds of up to 75 miles per hour. You don’t want to try to outrun one. However, a cheetah can only maintain this intimidating speed for less than a quarter-mile. In contrast, humans can run at slower speeds but can do so for hours, if needed, allowing our ancestors to hunt farther afield where cheetahs and other animals cannot reach.

Well-heeled investors — think, investment banks and many hedge funds — may have lots of knowledge that gives them an edge over individual investors. But individual investors have advantages of their own that can be hard for big investors to replicate. 

The key point here is that individuals need to stick to investing strategies that give them an edge and avoid those where the field is tilted in favor of other types of market participants.

3. Understand that long-term investing wins

It’s very hard for traders to make money in the stock market, and active trading massively underperforms passive investing. Only a tiny fraction (think: a few percent) of individual traders make money. By trading, individuals put themselves up against high-powered and well-funded Wall Street traders — the cheetahs — who feast on the stock market’s volatility.   

So where exactly do individuals have an advantage? In at least two places: 

• Long-term investing: Individuals can invest for the long term, avoiding those short-term trading “cheetahs” who are looking to pick up an easy score.
• Passive investing with index funds: Individuals can also focus on owning a broad portfolio of stocks through an index fund. This kind of fund passively tracks an index of stocks and owns whatever stocks are in that index. The most popular stock index is the Standard & Poor’s 500 (S&P 500), which includes hundreds of America’s top companies. 

You can combine these two strategies into one by owning an index fund over the long term. 

One key thing for investors to understand about index funds is that the fund owns all the stocks in the index, so you don’t need to select a bunch of stocks or have knowledge about the individual companies behind them. The S&P 500 has delivered excellent returns over time — about 10 percent per year on average — and you’ll get the fund’s returns by continuing to be a long-term investor in the fund. 

In fact, by investing for the long term — not selling when the fund declines, as it does from time to time — individual investors will end up beating the vast majority of investors, even the pros. Over the 20-year period ending in 2024, the S&P 500 beat 92 percent of comparable large-company funds, according to research from S&P Dow Jones Indices.

So, individuals who bought and held an S&P 500 index outperformed the vast majority of investors. These funds are available to any investor, and you don’t need extensive knowledge to buy them. Here’s how to buy an S&P 500 index fund and the key things to know.

4. Steer clear of fear

So buying an S&P 500 fund and then holding it will end up beating more investors, even if you have little knowledge or expertise. But even with the right investment, you can still be derailed on your path to wealth. In fact, you’re likely to be your own biggest enemy in investing. You’re going to want to sell when the stock market looks rocky and your investments start to go down. 

It happens again and again to investors. Your fear instinct kicks in, and you’ll sell to avoid an even further loss. We saw it happen just recently, when U.S. President Donald Trump announced a series of global tariffs in early April. The market plunged for days, and then soon it began to rebound. As of June 10, the market had erased all its losses from the start of the year. Those who sold on the fear missed out on the rebound and now may have to reinvest at higher prices.

It’s another reminder that individual investors need to stick to the areas where they can win — long-term investing — and not play a short-term trading game where Wall Street wins. Individuals need to steer clear of fear if they want to keep building wealth over time. It may mean turning off the financial media or anything that makes you veer from your long-term investments.

5. Put your investing on autopilot

Another great strategy for individual investors to help them short-circuit the fear response is to invest on autopilot. Set out a plan where you invest a fixed amount every week or month regardless of what’s going on in the market. Many investors already do this through a workplace retirement plan such as a 401(k) or 403(b), which invest straight from their paychecks.

By setting up a plan to invest regularly and taking the decision-making out of the process, you keep the emotion out of your investment decisions. Then you’re less likely to be scared out of the market or tempted to make a poor decision in the heat of a market decline. Work with one of the best brokers for mutual funds and set up a plan to invest in index funds automatically.

Bottom line

It’s fully understandable that many young investors are intimidated by the stock market — there’s a lot to know! But understanding how the market works and how individuals can thrive can help reduce that fear factor. By using proven investing strategies, individual investors can make smart financial decisions that help them build wealth for decades.