Published on

How to Start Investing with Just $100

Authors

How to Start Investing with Just $100

Okay, let's be honest. The world of investing can seem intimidating. You hear about needing thousands of dollars to get started, and it feels completely out of reach. But guess what? You can absolutely begin building wealth even with a relatively small amount like $100. It’s never too late to start – and starting small is often the smartest approach.

This isn't about getting rich quick. It’s about learning, gaining experience, and building good habits. With a little research and a smart strategy, $100 can be the foundation of a successful investment portfolio.

1. Choose Your Investment Vehicle

With $100, you’re limited in your options, but that’s okay! Here are some accessible ways to invest:

  • Fractional Shares: Companies like Robinhood, SoFi, and Schwab offer fractional shares. This means you can buy a portion of a share of a company, like 50ofApple(AAPL)or50 of Apple (AAPL) or 20 of Amazon (AMZN). This removes the barrier of needing to buy a full share, which can be expensive.
  • Exchange Traded Funds (ETFs): ETFs are baskets of stocks or bonds that track a specific index, sector, or investment strategy. Many ETFs have low minimum investment requirements – often around 10or10 or 25. You can find ETFs that focus on growth, value, or specific industries.
  • Micro-Investing Apps: Apps like Acorns round up your purchases and invest the spare change. It’s a simple way to start investing without actively managing your portfolio.

2. Picking Your Investments (With $100)

  • Diversify (Even a Little): Don't put all your eggs in one basket! With $100, it's tricky to diversify massively, but try to spread your investment across at least two different investments – perhaps one ETF and a fractional share.
  • Consider Growth ETFs: For long-term growth, ETFs like Vanguard Growth ETF (VUG) or iShares Core S&P Growth ETF (IXGS) are great options.
  • Start Small with Individual Stocks (Carefully): If you're feeling adventurous, you could pick one or two fundamentally strong companies and buy a small number of shares. However, be aware that individual stocks are riskier than ETFs. Do your research!

3. Important Considerations & Long-Term Strategy

  • Brokerage Fees: Make sure your brokerage account doesn’t charge high fees. Many platforms offer zero-commission trading now, which is fantastic.
  • Dollar-Cost Averaging: This strategy involves investing a fixed amount of money at regular intervals, regardless of the price. For example, invest $100 every month. This helps mitigate the risk of buying high and selling low.
  • Long-Term Perspective: Investing is a marathon, not a sprint. Don't panic sell if the market dips. Focus on your long-term goals.
  • Learn Continuously: The more you learn about investing, the better decisions you’ll make. There are tons of free resources online – investopedia.com, fool.com, and YouTube channels are great starting points.

Resources to Get You Started:

The bottom line: Starting to invest with $100 is a fantastic first step. It’s about building good habits, learning the ropes, and setting yourself up for long-term financial success. Don't let the perceived cost stop you – your financial future starts now!