Only Have a Little Cash? Here Are 4 Ways to Invest It

Where to invest $500, $1,000, $2,500, or $5,000

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It's tough to scrape together enough cash to start investing, but even small sums become significant down the road. In this post from TheStreet.com, financial planner Ginita Wall, coauthor of It's More Than Your Money—It's Your Life: The New Money Club for Women, shares ways to invest $500, $1,000, $2,500, or $5,000:

$500: Buy an I savings bond, which currently pays 4.84 percent (the interest rate adjusts on a semiannual basis). At the current rate, she says your $500 will quadruple to $2,000 in 30 years. Savings bonds are a safe place to park your money, but it's worth considering what the purchasing power of $2,000 will be in three decades.

$1,000: Buy stock on the cheap through your employer's stock purchase plan. "Generally, your employer takes money out of your paycheck every month on an after-tax basis and, every six months, uses what's accumulated to buy you stock at a discount (usually around 15 percent). In six months, your $1,000 will buy you $1,200 worth of stock, so you've already made money," the post says.

$2,500: Buy a CD. Shop around for the best rates (right now, that's between 3.5 percent and 4 percent on CDs ranging from three to five years.) Wall says CDs are a good bet if you have an anticipated expense coming up in a few months or years—perhaps buying a car or grad school.

$5,000: Buy a stock mutual fund. The post recommends Vanguard Total Stock Market, which requires only a $3,000 minimum investment, and T. Rowe Price Equity Income, which requires $2,500. If you invest in a fund that churns out an annualized 9 percent return, your $5,000 would become $12,000 in 10 years.

I've written about funds you can invest in with just a few hundred dollars. Exchange-traded funds are a great option if you can invest a few thousand dollars. Here are recommendations for an all-ETF portfolio. Also, Kiplinger's Personal Finance columnist Steven Goldberg recently wrote about seven ETFs that should work well for this market.