Investing takes a whole lot of thought, precision, strategy, and confidence.
And yes, it also takes money. But it doesn’t have to take all of your money.
While spending big on a high return investment can reap you some great rewards later in life, it’s getting started with little money that can lay the foundation towards financial success and security.
That’s why you should consider investing in something, even if you don’t have a whole lot of money to do so. Whether you stuff your extra bills under your mattress (not recommended) or keep your loose change in your car’s center console (also, not recommended), you may discover that a little bit can go a long ways and help you make larger, smarter, and more lucrative investments down the line.
But, you have to start somewhere.
With that in mind, let’s take a glance at a few ways that you can get started investing with little money, which will help you grow into big money later in life.
Adult Piggy Banks
We all loved the concept of a piggy bank when we were younger. We’d save up our allowance, or just collect random coins we found on the playground, and save them in our own special little jar. We’d use those savings to buy a new book, a video game, or maybe even a new bike or pair of shoes. And it worked! Well, who’s to say it can’t work now, as an adult?
If you don’t have enough money to invest into annuities, bonds, or a retirement account just yet, start by saving your spare bills, change, and anything else you collect throughout your day-to-day routine in a regular bank savings account (this is a much safer practice than keeping a literal piggy bank around the house).
Most savings accounts are free to open, and they might even offer a little (very little) amount of growth through interest. Still, they are a great place to store your extra money for safekeeping with virtually zero risk.
Got a check from your aunt for your birthday? Put it in your savings account! Did you win $50 from a scratch ticket? Put it in your savings account! This “adult piggy bank” can help you save money that you wouldn’t have otherwise noticed, which can not only come in handy in the future but also help you understand the importance of putting money aside when you get a job.
Take Advantage Of Retirement Plans
If you’re at the point where you recently started a career, or maybe you’ve just been putting it off, now’s the time to start planning for retirement. A safe and effective way to save even with a lower income and a little bit of money is to open up an employer-sponsored 401K account. Often times, your employer will do most of the heavy lifting, and all you need to do is enroll. When you start off, it’s imperative that you contribute anything, whether it be $50 or $100 per paycheck. However, as you grow throughout your career, you’ll need to begin contributing more and more in order to ensure that you’re well taken care of in retirement, no matter how far away it may seem. 401K accounts, as well as self-directed IRA accounts, are great ways to get your feet wet with a high return investment even with little money.
Keep Debt At Bay
Another good strategy before you are able to make a big splash with investing is to do everything you can to pay off your debt, from credit cards to student loans, before it becomes too big of a hindrance. Make debt a priority and treat it like an investment, because in the long run the less debt you have, the more you will be able to accumulate and save.
Build Up To The Big Stuff
When you’re first starting out with little money, these are good strategies to get you started. It’s important that when you’re young, you don’t jump into investments that you don’t understand. Then, as you accumulate your wealth and savings, you can make the leap to another type of low risk, high return investment like the Fixed Income Fund. Give us a call if you think the time is right for you and learn how you can receive consistent, reliable income along with peace of mind.