Even after the financial crash of 2008, there is still a great deal of interest in investing. After all, it’s one of the most effective ways to build wealth over time. However, many would-be investors claim that they don’t have enough disposable income to invest.
The reality, however, is that it’s possible to begin investing with as little as $25. Most of us can find $25 in our monthly budgets. Online brokerages make it easy to begin investing with a small amount of money, and it’s possible to purchase partial shares. Chances are, though, that you recognize the importance of increasing the amount you invest beyond $25 (or $50 or $100) a month.
Happily, money is something you can usually find more of.
Find Money in Your Budget
If you want more money to invest, you need to take action. Decide that investing is a priority, and take steps to create more room in your budget for investing. There are two main strategies to apply when looking for more money:
You can find more money for investing when you actively look for it. Combine both strategies for even more dramatic results. However, the fact that you don’t need a lot of money to get started with most discount brokerages makes it a little easier to identify money in your budget that could be invested.
Start small, but grow your investment over time. As your circumstances improve, increase your monthly contribution. It’s much easier to invest $100 a month later if you are already investing $50. Create a habit of regular investment, and boosting the amount will come easier to you as your net worth grows and your personal cash flow improves.
Investment Ideas for the Small-Budgeted Beginner
If you have a small budget, especially to start, there are some investments that are a little easier to understand – and that many beginners feel a little safer devoting their hard-earned money to:
There is always the risk of loss, no matter what investment you choose. However, if you don’t invest, you run the risk of losing out to inflation in the long run – and you don’t have the ability to build your wealth at the same rate. It doesn’t take much money to begin investing. Chances are that you can find the capital you need to get started by making a few simple changes to your budget each month.
Miranda is a freelance contributor to several investing and personal finance web sites, as well as writing for her own blog, Planting Money Seeds.