Investing With Limited Funds: Tips For Getting Your Feet Wet

Although it comes with risks, investing is one of the most efficient ways to secure your financial future. While most people are aware of this fact, many avoid this opportunity due to limited funds. The assumption is that investing is for people with hundreds of thousands of dollars to spare. Consequently, millions of people overlook the significance of future planning until they near retirement age and realize they’re nowhere near prepared.

The good news is this doesn’t have to be your fate. Whether you have an additional $25 or $1,000 month, you can invest it in something that yields a great return. Continue reading to learn more about ways to invest with little money.

Savings Accounts

If you don’t have a savings account, you should consider opening one. It’s the simplest way to invest with no risks. While the national average of 0.06% interest may seem small, every penny counts. If you deposit $100 into a savings account with a 0.06% interest rate and deposit $100 a month for the next ten years, you’ll have an extra $36 for doing absolutely nothing.

Employer Retirement Accounts

If your employer offers a retirement account, this is another investment you don’t want to pass up. Many companies provide employer-match programs where they’ll match your contribution up to a certain dollar amount. This would ultimately increase your savings and interest so you can retire comfortably.

Employee Stock Purchase Plans

If you work for a publicly traded company, they may offer employee stock purchase plans. These are investment opportunities for employees interested in owning shares in the company. Employees can invest as much as %15 of their income and receive a discount of 15% on stock prices.

The discount results in an automatic return as employees can easily sell shares at market value. If the company performs well and the stock value increases, you could have several hundred or thousand dollars by the time you retire.

Equity Crowdfunding

There are lots of startups and small businesses in need of money. Unfortunately, acquiring a traditional personal or business loan is often out of the question for new entities. That’s where equity crowdfunding comes into the picture. It’s a platform where entrepreneurs are matched with investors to raise funds for their business.

Instead of acquiring a large lump sum from one investor, the platform is designed to allow groups of people to invest small amounts. So, with $100, you could have a stake in an up-and-coming company. There’s something about knowing that you’re helping someone actualize their dream while saving for your future that makes this a worthy investment.

Real Estate Crowdfunding

You don’t need hundreds of thousands of dollars to invest in real estate. Similar to equity crowdfunding, real estate crowdfunding platforms enable individuals to invest small amounts of money to own shares in commercial and residential properties. The best part is you share the expenses and risks with other investors and don’t have the many responsibilities of being a landlord.

Micro-Investment Apps

If saving money for investing is challenging, micro-investment apps are a practical solution. These are applications that enable users to save and invest small amounts of money. Account-holders can sign up for programs that automatically round up their purchases. The spare change is then placed in an investment account. While each app varies, most enable users to start investing with as little as $5. Essentially, you’re investing in your future using spare change from everyday purchases.

It’s common to assume that you need a lot of money to start investing in your future. Be that as it may, this is far from the truth. There are both old and new investment strategies available for everyday citizens with limited funds. Don’t avoid securing a better future for yourself simply because you only have a few bucks to spare. Instead, look into investment opportunities like those listed above. With a careful plan, a small investment, and patience, you could cultivate a financial cushion to live the life you want in a few years.