Whenever someone mentions the word “investing”, people think of all kinds of things. Some instantly think of Forex trading, stocks, cryptocurrencies, and more. While all of these are viable investment options, the word investing can mean a lot more things. You can also invest with very little money.
If we look up a literal definition of what investing means, we get something along with the following. Investing is putting money into something to achieve a profit. This “something” is usually a financial scheme, property, shares, and anything similar.
But the real question is how to start investing with little money? No doubt many of you have thought about it. So that’s why we’re here to talk about that. In this article, we will look at the 3 easy ways to invest with little money.
Use Your Cookie Jar
People that look up ways to invest with little money seem to forget that you need money in the first place. If you’re looking to invest with little money, then chances are you have at least some money on the side. Maybe you’ve put aside some funds in a cookie jar or you have them stored in your savings account.
But this first approach has more to do with saving, than with investing. Naturally, the easiest way to invest is to use your own money. Borrowing money for the sake of investing is a mistake you should always avoid making. If you don’t have any money saved in your cookie jar, then it’s time to start accumulating an investment budget.
What many people also seem to forget is that investing isn’t a “get rich quick scheme”. It takes research, hard work, and taking the risk for your investments to pay off. But the first rule of investment is indeed to have money. It doesn’t matter how much money you’ve saved, what’s important is to use it when the time comes.
Try Investing In Stocks
Whenever someone says they’re going to invest, what most come to the conclusion is that they’re talking about stocks. The stock market presents a unique opportunity for everyone to seize. You can make so much money out of trading stocks that you can ditch your job and become a full-time trader. But not everyone is interested in day trading. More so, day trading is very complex and requires years of experience to become a successful day trader.
What you can do instead is find opportunistic stocks and invest for the long run. The stock market is there for everyone to try their luck and make some money. What you’ll hear expert investors say is to always diversify your portfolio. A well-diverse portfolio helps minimize risk.
Try Investing In Bonds and Treasury Securities
Not everyone understands what investing in bonds means. To simplify things, let’s just say that investing in bonds means lending money to the government or corporations. In exchange, you’ll be paid in interest. The reason why bonds are so popular is that they’re a form of debt investment.
The government and corporations both allow you to lend them money, but they don’t distribute risk the same way. Treasury bonds are backed by the US government, making them an extremely safe investment option. Corporate bonds pay much more than government-backed bonds, but they are much riskier as a corporation or company can very easily go bust.
Both options are excellent if you have very little money to play with.
Try Investing In Precious Metals
People are quite touchy when it comes to this investment option. Why? Well because not everyone believes that precious metals are a sound way to invest with little money. Strong advocates of this type of investment are very vocal about it. They believe their reasons are far better than those that are opposed to investing in gold and other precious metals.
In short, investing in precious metals means buying gold and silver and waiting for the price to rise to sell and make a profit. Over the past four decades, the price of gold has risen by a whopping 1,390%. In the last year alone, it has risen by 145%.
That’s not a bad return for someone that has very little money to play with. More so, stock or bond trading will never promise similar returns.
It will always be more difficult to start investing with little money. But it doesn’t matter how much money you have to play with, what’s important is to make the right investments. No doubt the biggest challenge will be getting a sufficient amount of money to start. But once you get that over the line, these three investment options can help you turn a nice profit.