Tips on how to start investing with little money

Investing might seem scary if you can’t afford to buy big and devote all of your time to it. But the reality is that investments don’t always require huge capital or a copious amount of time. Of course, this does not apply to most types of investments, you’ll have to find the right one that works for you, but with the right approach, anyone with limited resources and a busy schedule can get started in their investment journey. Whether you’re a teenager above the age of 18, in your 20s, a new parent, or between jobs, there are accessible ways to begin investing. Let’s explore them:

For the younger crowds

The power of education

Do your best to take advantage of any online resource you can get your hands on: Books, blogs, and online courses to learn about the fundamentals of investing. Learning and understanding some of the most important concepts like compound interest and risk diversification from the get-go will help young investors build a solid financial foundation and build skills that will help them throughout their lives.

Question everything

Being young on the Internet means being exposed to a huge influx of information that might trick you into wasting money or even collecting debt, and this is not something we want, especially if your money available is very limited. You’ll need to make every cent count. TikTok, Instagram, and Reddit are full of online communities you might want to join, but do so with a healthy dose of skepticism and be always wary of online misinformation and trends. Question everything you see, check the credibility of the source, assess the sources and the evidence provided, and try to consider whatever biases might appear down the line.

For people in their 20s

Micro-investment apps

Investment apps such as Beewise will allow you to invest small amounts of money. Our app has been designed to automate your investment processes and to make it as simple as possible for you to invest any spare change you might have at the end of the month.

Exchange-traded funds (ETFs)

The concept of exchange-traded funds is quite simple, ETFs are a type of investment fund that are meant to combine the best of two worlds, the features of mutual funds and stocks in the same place.
Investors from various backgrounds can pool their money to purchase a diversified portfolio of assets, such as stock and bonds, commodities, or a combination of all of them. ETFs are usually traded on stock exchanges, so they will allow you to buy and sell the shares at market prices during the trading day. ETFs are great for people who want to invest with little starting capital as they’re designed to track the performance of a specific index, sector, commodity, or other underlying asset. They’re easy to use, transparent, liquid, and cost-efficient. A great tool for beginners and people in their 20s.

Time is money

You should think of passive income investments like seeds that are planted in winter and continue to reap fruits throughout the year without too much effort. You can invest once, and if you’re lucky it will keep generating money over time, over and over again, even if you’re not actively focusing on it.

REITS or real estate investment trusts are a great option for this, when you invest in them you’re basically investing in real estate properties. If you choose this option you’ll be able to generate rental income through real estate properties.

Once you’ve made the initial investment, you won’t have to keep following up on it, and there won’t be a huge need for effort to keep them up as they work quietly in the background, generating potential income for you.

For people juggling the costs of childcare

Having children can be a huge setback in your investment journey, childcare is very expensive, and raising a child until they’re 18 is estimated to cost up to €100,000, leaving you with less funds to work with. Automating your investments is always a good idea, whether you’re dealing with kids or not. Setting up any kind of automatic fund where your funds end up without having to think about it will ensure you consistent savings and investing without the need for constant monitoring.

The Beewise app

Using financial tools and apps to track your expenses has never been easier. With Beewise, you can set your monthly budgets, which will help you save better. You can then easily invest your savings and connect it to your financial goal. This way, you can invest in no time, freeing up time for childcare responsibilities and making the most of whatever amount of money you manage to save at the end of the month.

For people with unstable jobs

Build an emergency fund

Starting to invest with little to no money is even trickier if you find yourself between jobs or are working in an unstable field. Try to prioritize building an emergency fund to cover your expenses in case of job loss or other financial emergencies. You can’t invest if there is no money left in your bank account, can you?

Flexible investments

When between jobs or if you’re not feeling confident about having a fixed stream of income in your near future, you might want to consider investments that offer liquidity and flexibility such as low-cost index funds or ETFs. If you take this route you’ll be able to sell and buy whatever assets you might feel drawn to without incurring huge fees or penalties.

For the older generation that still wants to experiment

Fractional shares

Fractional shares can be an option for everyone, but let’s say you’re retired and looking into safer investment options. Fractional shares are a great and accessible way of buying and selling fractions of shares on online brokerage platforms. It makes it possible for people with limited funds to access and participate in the market without having to purchase whole shares of expensive stocks.

In conclusion, it’s never too early or too late to start and you don’t have to let the lack of funds scare you away from the world of finance. By leveraging accessible investment options and tailored strategies anyone can begin their investment journey and work towards a better future.

Disclaimer: This article has been distributed for educational purposes only and should not be considered investment advice or a recommendation of any particular security, strategy, or investment product. Information contained herein has been obtained from sources believed to be reliable, but not guaranteed.