Investing is no longer a “rich” person's game. You can start investing with as little as $25. Don't wait any longer.
Last night I visited my grandma. She's in a comfortable financial position, thanks to years of prudence, as well as an appropriate life insurance policy from my grandfather.
But she never got into investing. She didn't need to, since my grandpa's peak working years happened during a time when pensions were common. They had land they sold just when Utah County was exploding with developers. And they grew their nest egg during times when savings rates weren't so abysmal.
As we talked, she mentioned that she didn't understand why so many people seemed to be investing. “You need to have so much money to invest. How is it possible for so many people to invest?”
She's not the only one who thinks that it takes a large amount of capital to start investing. Many people mistakenly believe that you need to have a lot of money, and be some sort of genius to invest. But the truth is that you can start investing with as little as $25. And investing doesn't need to be complicated at all.
Start Investing with Online Brokers for a Small Amount
There are plenty of online brokers that will allow you to open an account with as little as $25. Some of them don't require you to put any money into your account at all when you open it. You don't need to maintain a minimum balance, and you're welcome to invest as much (or as little) as you can.
For the beginning investor, this can be a big help. It means you can start taking advantage of the power of compound interest earlier — and that means a greater chance for wealth later.
Look for an online broker that meets your needs, offering low minimums and requirements, and providing a number of low-cost investing options. One of the best things you can do is look for a broker that offers a variety of low-cost ETFs. When you have a small amount of money, it makes sense to put it in investments that offer you immediate diversity. Index funds and ETFs are good choices because they aren't as risky as stock picking, and you can enjoy a reasonable amount of diversity. It's even possible to invest in dividend funds, providing you with income, and a way to reinvest that income for even faster results.
Make sure that you invest consistently once you start. Even if you can only set aside $25 a month, that's a start. No, $25 a month isn't going to provide you with what you need to retire comfortably. But it does get you in the habit, and it can provide you with a foundation for your portfolio. Once you begin earning more money, you can boost your monthly investment, and build wealth a little faster.
Don't assume that you need a lot of money to start investing. You can start right now in many cases. The earlier you start, the better off you'll be.