Everyone in investment business says it is the best way to gain financial profits, but how do you start investments when you are broke? Most people think that to start an investment, you need a ton of money but that may not be the case. Most successful investors started off with pocket money or savings and are now making millions in their profits. Let us look at some of the ways you can invest with your little cash
How much do you have saved in your bank account? Savings and investment are interconnected. In order to invest, you have to have some savings. If you don’t have money in your bank account you should consider monthly savings. You can save as little as possible until you reach the desired goal. Get a habit of cutting down on your luxuries and sending the money to your bank account. You can start with small amounts and increase them as you adjust to the process. Saving is usually the first step leading to investment.
Acorns are online investing applications that let you invest your change. The application rounds up all the change you get from daily spending and puts it in an investment account with your bank. You can use acorns to invest in you spare money, even as little as a few cents.
If you are employed, enrol in your company’s retirement plan. Many may think that putting your money towards retirement is a form of investment. Most companies offer a match to your retirement funds. This means when you retire, you get free money from the company plus your retirement savings. You can start your retirement plan with low funds and gradually increase them as you progress.
Start dividend investment plans (DRIPS) by investing in index funds and company stocks. Many companies offer plans that pay dividends which you can use to buy shares with. Use dividend investments to buy shares in a company and watch them accumulate into big investments over time. The more shares you buy the greater the payout you get. You can use this cycle as an investment, keep adding shares to the company to grow your payouts. This investment does not require a lot of money. You can buy as little as one share on exchange-traded funds (ETF’s) through a broker. ETF’s track the performance of the bond and stock markets and pay dividends to their shareholders.
You should not start an investment plan when you still have financial debts. Paying off your debt first will help start you off on a clean slate. Clean credit card reports can help you secure a loan to start off a direct investment like real estate businesses.
Once you have started any form of investment, commit your money and time to make the investment grow. Increase the amount systematically so that you can earn more money from the investments. The little money you put into investment will not make you a millionaire, but it gives you a good beginning and starts a habit that can benefit you in future.