Interested in investing for beginners with little money, but don’t know where to start?
Wondering what investing is to begin with? Check this post out.
This post is about investing for beginners with little money.
Let’s dive into the top 3 tips for investing for beginners with little money:
1. Set Clear Financial Goals
Investing is a strategy. It can be very simple or challenging, depending on how you go into it. With strategies, the tasks become easier when the objectives, purpose, and action items/deliverables are defined. What is the bigger picture goal you’re trying to achieve? Do you want to retire early, buy a house, go on vacation? Having specific goals will help determine which strategy suits you best.
2. Fractional Shares Are Your Best Friend
Previously, say a stock price was $100 but you only had $90 to invest, you wouldn’t be able to purchase a share unless you had the full $100. However, since Robinhood innovated the investing industry, fractional shares are now available on investing platforms/companies. The reason this is important and a complete game changer? It’s because now, you’re able to invest in companies with higher share prices without needing to purchase a whole share. This makes investing widely accessible, completely changing the game for people to build wealth.
That being said, by investing in fractional shares, you can start off with as little money as you have. No more obstacles to prevent you from investing! In addition to that, there are a lot of index funds that are low-costing, making it even more affordable.
3. Time in the Market, Not Timing the Market
Buy low, sell high. It’s crazy to think that the concept of investing to create wealth really boils down to those 4 words. Buy an investment low, sell higher than you purchased it for. However, the main variable we can’t account for is the timing. When will the cost be low? When will it be higher? Nobody knows. Which is what they mean when they say do not time the market.
Investing is a long term strategy. Those who invest consistently over a long period of time typically have better results than those who try to predict short-term movements. Predicting the market is challenging, even for those who are experienced. There are unforeseen circumstances/events, potentially missing out on the best-performing days, emotional bias, and market volatility to consider. That’s why the suggested strategy is the amount of time you’ve invested in the market, and not timing the market.
To reiterate, the top tips for investing for beginners with little money are:
- Set clear financial goals
- Fractional shares are your best friend
- Time in the market, not timing the market
There you have it! Interested in learning more about investing for beginners with little money? Check this post out for the different types of investments.
Hey!
Interested in seeing more? Check out our Instagram, Pinterest, and Twitter below!
