How to Get Started in Investing (Even If You Don't Have a Ton of Money)

Concept of money growing into something more, to illustrate investment

One of the biggest misconceptions about investing is that it cost more than the average person can afford.

But, this is far from the truth, and investing is not reserved for the wealthy. By using better investment strategies, you can make more return with less initial input that.

Therefore, there are options for people of almost any income level to see their income grow over time with incremental and small investments.

The earlier you are able to begin investing, even in small amounts, the more long-term payout you will likely see.

Read on to learn how to get started in investing in four simple steps to start building your portfolio today.

Save, Save, Save

Saving and investing are interrelated to one another. The first step to any investment plan should first be to save enough to invest.

It is understandable if you are not great at saving money, as many American's are not. That said, saving is the key to responsible money habits.

Therefore, try taking a cookie jar approach, where you save a set amount each week and place it in a cookie jar or envelope. Best yet, place it in your savings account.

Regardless of how much it is, you can invest it all at the end of the year to make bigger returns.

Enroll in Your Employer's Retirement Plan

Investing in your employer's retirement plan can be one of the easiest ways to start building a portfolio.

Even something as small as 1% of your salary can help you grow your investment, and you can gradually increase the percentage as time goes on.

In addition to your employer's 401(k) or similar retirement plan, also look into individual retirement savings accounts.

Find a Low-Initial Investment Mutual Fund

A low-initial investment mutual fund is a fairly recent advent, but the perfect one for new investors.

There are many different options today for investments under $500, but you may have to agree to put away a certain amount into the fund each month.

Think about Stock Options

The best stock strategies are hotly debated, but most experts agree that it is best to think more about the long-term.

Choosing responsible, trackable companies is generally the safest option. As well, funds tend to be better than individual stocks but this will depend on a few different factors.

In terms of how to get started in investing, the first step you should take before entering the stock market is to determine your risk tolerance.

This is essentially how willing you are to take risks within the context of investing. Sometimes, risks will pay off, but sometimes they will not.

Answering these hard questions will make it easier down the road, and help you be realistic about the investment options for you.

A financial advisor is a great idea for first-time investors in order to examine their options. Ellevest is the perfect choice for female investors looking to create a diverse portfolio.

How to Get Started in Investing the Right Way

All and all, how to get started in investing is incredibly important to long-term financial success. Getting started as soon as you can ensure your investments pay off.

Moreover, there are many different strategies and approaches you can take in investing in order to make the best decision for you.

For more information on how to be financially prepared for your future, check out our article on how to financially start planning for retirement.

 

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