Building your first investment portfolio can feel complicated. There are hundreds of ETFs and stocks to choose from, countless strategies to consider, and plenty of opinions about what you should buy.
But your first Portfolio on SoFi doesn’t need to be complicated. The goal is to create a diversified mix of investments where every dollar has a purpose, then make it easy to contribute consistently over the long term.
One simple approach is to use four ETFs, each serving a different role: a broad U.S. market foundation, a large-cap growth engine, an income-focused investment, and international diversification.
What Makes a Good Portfolio on SoFi?
A portfolio isn’t simply a collection of stocks and ETFs that happen to look interesting. A well-constructed Portfolio on SoFi should have a deliberate mix of assets, with each investment serving a specific purpose.
Think of it like building a team. You need:
- A foundation to provide broad market exposure
- A growth engine to pursue long-term returns
- Income from dividend-paying investments
- Diversification beyond a single country or market
These four objectives can be addressed with four relatively straightforward ETFs.
ETF #1: VTI as Your Foundation
VTI, the Vanguard Total Stock Market ETF, can serve as the foundation of a beginner portfolio.
Instead of focusing on a specific segment of the market, VTI provides exposure to a broad range of U.S. companies, including large-, mid-, and small-cap stocks. That means you aren’t relying on just a handful of major companies to drive your investment results.
The fund includes well-known companies such as Apple, Microsoft, Nvidia, Amazon, and Alphabet, along with thousands of smaller businesses.
VTI also has a very low expense ratio of 0.03%, making it an inexpensive way to gain broad exposure to the U.S. stock market.
For someone who wants to keep their Portfolio on SoFi simple, a broad-market ETF like VTI can provide a strong core holding.
ETF #2: VOO for Large-Cap Exposure
The second ETF is VOO, the Vanguard S&P 500 ETF.
While VTI covers the broader U.S. stock market, VOO focuses on approximately 500 of the largest U.S. companies. These include many of the biggest and most influential businesses in the economy.
VOO also has an expense ratio of just 0.03%.
The tradeoff is concentration. Because VOO focuses on large companies, particularly the biggest businesses in the index, it can be more heavily influenced by mega-cap stocks and technology companies.
That doesn’t necessarily make it a bad investment. It simply means your Portfolio on SoFi will have somewhat more exposure to large-cap U.S. companies when you include VOO.
ETF #3: SCHD for Dividend Income
The third ETF is SCHD, the Schwab U.S. Dividend Equity ETF.
Unlike VTI and VOO, which primarily serve as broad growth-oriented holdings, SCHD is focused on dividend-paying U.S. companies.
The fund holds roughly 100 established businesses with characteristics such as financial strength and a history of paying dividends. Those companies distribute cash to shareholders, generally on a quarterly basis.
SCHD has an expense ratio of 0.06%, which is still relatively low compared with actively managed funds.
Adding SCHD can give your Portfolio on SoFi an income component while maintaining exposure to established companies. However, dividend investing isn’t risk-free, and a high dividend doesn’t automatically make a stock or ETF a good investment.
ETF #4: VXUS for International Diversification
The fourth ETF is VXUS, the Vanguard Total International Stock ETF.
The first three ETFs primarily focus on U.S. companies. VXUS adds exposure to companies outside the United States, including markets in Europe, Japan, the United Kingdom, China, India, Brazil, and Australia.
The fund provides exposure to thousands of international companies and has an expense ratio of 0.05%.
International markets have underperformed U.S. stocks during some recent periods, but that doesn’t mean they should automatically be ignored. Different markets can perform differently over different decades.
The purpose of adding VXUS is primarily diversification rather than trying to predict which country will produce the highest returns next.
How to Split Your Portfolio on SoFi
Once you’ve chosen your ETFs, the next question is how much money should go into each one.
One simple framework is to base the SCHD allocation on your age. For example, someone who is 30 might allocate 30% to SCHD, while someone who is 50 might allocate 50%.
For a hypothetical 30-year-old investing $1,000, the suggested allocation would look like this:
| ETF | Allocation | Amount |
|---|---|---|
| VTI | 40% | $400 |
| SCHD | 30% | $300 |
| VOO | 20% | $200 |
| VXUS | 10% | $100 |
The idea behind this approach is that younger investors generally have more time for growth and compounding, while investors approaching retirement may place greater emphasis on income.
However, there is no universal allocation that works for everyone. Your goals, time horizon, risk tolerance, and overall financial situation should determine the right mix.
Most importantly, don’t get so caught up in finding the perfect percentages that you never start investing.
How Fractional Shares Make Investing Easier
One of the useful features for a new Portfolio on SoFi is fractional-share investing.
You don’t necessarily need enough money to purchase a complete share of an ETF. If an ETF costs hundreds of dollars per share, you can still invest a smaller dollar amount and own a fraction of a share, subject to SoFi’s applicable requirements and minimums.
For example, if you have $100 available, you could divide it among your chosen ETFs rather than waiting until you have enough money to purchase whole shares.
A hypothetical $100 contribution could look like:
- $40 into VTI
- $30 into SCHD
- $20 into VOO
- $10 into VXUS
This allows you to follow your target allocation even when you’re starting with a relatively small amount of money.
How to Buy ETFs on SoFi
Once you know what you want to buy, the purchasing process is straightforward.
From the SoFi Invest screen:
- Select Invest.
- Use the search function to find the ETF you want.
- Select the ETF from the search results.
- Tap Trade.
- Select Buy.
- Choose to enter your purchase in dollars if you’re using fractional shares.
- Enter the amount you want to invest.
- Review the order.
- Confirm the purchase.
The same basic process applies whether you’re buying VTI, VOO, SCHD, or VXUS.
For a beginner, a straightforward market purchase can be easier to understand than trying to use more advanced order types. Limit and stop orders have specific purposes, but they aren’t necessary for every long-term investor.
How to Build the Full Portfolio
After purchasing each ETF according to your target allocation, you’ll have the basic structure of your Portfolio on SoFi.
For example, with $1,000 and the allocation above, you would have:
- $400 in VTI
- $300 in SCHD
- $200 in VOO
- $100 in VXUS
Fractional shares make it possible to put precise dollar amounts into each investment without worrying about whether you can afford a full share.
The next step is arguably even more important: making the portfolio work automatically.
Turn on Dividend Reinvestment
Dividend reinvestment, commonly called DRIP, allows dividends from your investments to automatically purchase additional shares rather than being left as cash.
Suppose an ETF pays you a dividend. Instead of taking that money out, the dividend can be reinvested into the investment. Those additional shares can potentially generate dividends of their own in the future.
That’s the basic idea behind compounding.
On SoFi, dividend reinvestment can be enabled through your investment account settings. You can access your account, open the management settings, and look for the dividend reinvestment option.
One important detail is that SoFi’s DRIP setting applies at the account level rather than allowing you to independently choose DRIP for each individual position.
So if you enable it, dividends in the account are generally reinvested rather than selectively reinvesting only certain ETFs.
Changes to dividend reinvestment may also take some time to become effective, so don’t be surprised if the first dividend after changing the setting doesn’t behave exactly as expected.
Make Your Portfolio Run Automatically
Building a Portfolio on SoFi is only the beginning. The real advantage comes from continuing to contribute to it.
Rather than trying to predict the perfect time to invest, consider making regular contributions. You can continue buying your ETFs according to your target allocation and allow the portfolio to grow over time.
This approach removes some of the temptation to constantly make decisions based on short-term market movements.
The goal isn’t to build a portfolio that never falls. That’s impossible.
The goal is to build one that you’re comfortable holding through both good and bad markets.
Rules for Managing Your Portfolio
Once your Portfolio on SoFi is built, the biggest challenge may be leaving it alone.
Here are a few simple rules to consider:
Don’t Check It Every Day
Watching your investments move up and down every day doesn’t make them grow faster. Frequent checking can also encourage emotional decisions.
Checking periodically is generally more useful than constantly monitoring short-term price movements.
Don’t Panic During Market Drops
Every stock-market portfolio will experience declines.
A falling balance doesn’t automatically mean your investment strategy has failed. Market downturns are a normal part of investing, although there is always a possibility of permanent losses.
The key is to understand the risks of your investments before you buy them so you’re prepared for volatility.
Avoid Constantly Changing Your Strategy
If you build a diversified Portfolio on SoFi, changing your investments every time the market moves can undermine the strategy you’re trying to follow.
Instead, establish an allocation, contribute consistently, and periodically review whether the portfolio still matches your goals.
Rebalance Periodically
Over time, some investments will grow faster than others, causing your allocation to drift.
For example, if VTI and VOO rise significantly while VXUS doesn’t, your portfolio could eventually contain a smaller percentage of international stocks than you originally intended.
A periodic review can help you determine whether rebalancing is necessary.
Give Every Dollar a Job
Your first Portfolio on SoFi doesn’t need dozens of ETFs or individual stocks.
A simple four-ETF structure can give you exposure to the broad U.S. market through VTI, large-cap companies through VOO, dividend-focused companies through SCHD, and international markets through VXUS.
From there, fractional shares can make it easier to invest smaller amounts while maintaining your desired allocation.
The most important part isn’t finding a magical combination of ETFs. It’s creating a strategy you understand, contributing consistently, reinvesting dividends when appropriate, and giving your investments enough time to compound.
The perfect portfolio doesn’t exist. But a simple portfolio that you actually build and stick with can be far more useful than a complicated strategy that never gets started.
