Being specific is important when it comes to setting goals. New investors often think about potential returns before figuring out what they really want, and that is a big mistake, according to Josh Brown, CEO of Ritholtz Wealth Management.

"Once you start defining your goals, an interesting thing happens, you realize that you don't need to take the maximum amount of risks to hit them," Brown said. Then, with a specific goal in mind, you can work your way backward and come up with a plan to get there. Brown says the goal can be as specific as someone wanting to be able to afford a house in the mountains in 10 years. That will give you an amount and a time frame to design your portfolio around.