$ 100 is not a huge investment, but successful investing is about taking small steps in the right direction. Let's take a look at how to invest $ 100, if that's not all you need to start.
Disclaimer: This article is for informational purposes only. It is not intended as investment advice. Find a duly recognized investment advice professional.
How to Make Your $ 100 Investment Go Far
With the right investment strategy, your $ 100 can do some work. But the first goal to invest your $ 100, whichever way you choose, is to avoid costs .
It is all too common to pay a fee for a service. For example, if you pay a $ 10 commission to buy stock market shares through a broker, you immediately lose 10% in fees. Not good. If you invest $ 10,000 with a $ 10 commission, that's acceptable – it's only 0.1%. So at the $ 100 level, investing should be ultra-cost effective.
First of all: no costs. At the $ 100 level, investments should be ultra-cost effective.
We will therefore focus on free or cheaper brokers and investment accounts, and develop other ideas. Other options may be available. Even if you just keep it in the bank, it means you will invest another day. But here are some considerations taken from advice from the investment community.
Oh, and hey, that $ 100 can be invested in yourself. Think of education, technology and experience. Good books and resources can take you further, keep you sharper, and avoid mistakes that can cost well over $ 100.
Investing is difficult, don't be fooled. Some of the world's top investors hardly ever sell their shares and prefer to hold on forever. Long-term plans based on research and education may be better than taking a dip with $ 100, so look out for this option.
Tips for Investing $ 100:
- Less Common Investments
- Education: Investing in Yourself
- Investing $ 100 Techniques
1. Investing $ 100 in ETFs
ETFs are exchange-traded funds, also known as index funds, that allow you to make a broad investment in many stocks all at once. They are convenient ways to invest in the market without having to choose good stocks: ETFs simply track a selected index (like the entire S&P 500) in a single stock.
ETFs: Simple, Powerful, Low Cost. It is worth taking the time to understand.
ETFs have power, because while they can track trillion dollar markets, individual stocks can be very low. For example, Vanguard's Total World Stock ETF is listed as VWOB and is currently listed on the NYSE at the time of writing $ 68.45. That means you can buy one share today and save the remaining $ 31.55 for your next investment.
Another ETF, Vanguard's top-performing ETF over the past 10 years on the US stock market ETF list is MGK, priced from $ 140 now. That's a little over $ 100, but gives you an idea of what $ 100 or thereabouts can make you.
None of these ETFs are provided as investment advice, as are examples of which large ETFs can be bought for around $ 100.  Why Vanguard? Well, not just Vanguard. But Vanguard is known, reputable, has no commission on its investment account for most ETFs, and its ETFs have competitive expense ratios. You need a Vanguard Brokerage account, which requires you to sign in, prove your identity, and so on. But that is the same everywhere. Blackrock has similar ETFs with a super low fee under the iShares brand, but they go through Fidelity for commission-free trading. It's your decision.
Finally, free brokerage apps like Robinhood or Charles Schwab also allow you to buy some ETFs without commissions. Again, you need to sign in, download the app or account and go from there.
2. Invest $ 100 in stock
You may want to buy a single share. While ETFs are similar to stocks, you may want to be stock selection and buy stocks in your immediate pick. For example, Apple, Google (alphabet), Amazon or Netflix. But! A share in Apple is $ 290. Google is $ 1,200. Amazon costs $ 2500. Your $ 100 doesn't go that far.
Now you can buy cheaper shares, for example, Starbucks for $ 77 per share, but again if you really want to buy a stock that costs more than your budget, there are ways
Buy one share or buy a lot of fractional shares: new options open up the market.
You can buy these more expensive shares with fractional shares an option offered by some. brokers such as Robinhood, M1 Finance, Betterment, Stockpile and others.
What is a fractional share? It is part or a fraction of a share, and they can be absolutely small, as small as a thousandth of a share.
Robinhood offers fractional shares, stating that its goal is to open financial services to everyone, regardless of the starting investment amount. Therefore, that service allows you to buy a few fractions of Google or Amazon with your $ 100. And if Google goes up 10%, your fractions will too.
There are some minor differences you should know: for example, holding ordinary shares gives you shareholder rights and the ability to attend meetings. While the drawbacks of fractional stocks are real, for most people it is still a great way to get started while upgrading to buying a whole share of normal stocks. $ 100 in less common investments: peer-to-peer loans, cryptocurrency (proceed with caution)
Want to lend your money to someone else and earn some interest? That is a form of investing and it is called peer-to-peer loans . This is a platform that you can get started with just a small investment, such as $ 100, lent to someone who needs a loan.
Sounds risky? It is not perfect. Peer-to-peer (P2P) loans are risky: people go bankrupt all the time! That puts your $ 100 more at risk than keeping it in the bank, without a doubt. But you do get access to higher yields than bank interest at a cost of about 1% or so. Not all P2P lenders will get you started with $ 100. Prosper is an option that can start with as little as $ 25.
Cryptocurrency is an investment area that is extremely volatile and hard to trust.
Cryptocurrency is an investment area that is extremely volatile and difficult to really trust. That said, you can only invest a few dollars in an asset like Bitcoin. You don't have to buy one whole Bitcoin! Bitcoin is floating above $ 7500 at the time of writing, but you can buy fractions. So you can buy a few fractions of a Bitcoin up to $ 100 and you build your portfolio. You have to jump through a few hoops when signing up with Coinbase or other crypto providers or apps, for example, but this is a necessary step to get your Bitcoin back in hard currency so it's worth it.
Should you invest your money in P2P or crypto? Is that a good idea? We cannot give advice. These are just examples of less conventional investments that can be made with $ 100.
4. Education: Investing in yourself
Now we come to a bigger idea: invest that $ 100 in yourself. Books and resources that provide you with learning opportunities and help you avoid common mistakes.
Other ideas: Buy headphones to listen to regular finance and money podcasts for your understanding. Get your phone sorted out if it's not reliable: improve battery life or fix the battery so you can focus or fix the screen so it's legible. These are small things, but they are cheap or free.
Not all teaching costs! There are also free resources. Here is a list.
- r / personalfinance – a large, busy subreddit for budgeting to investing. Personal but always interesting. Tip: Using this filter limits topics to investing topics only.
- r / investing – a targeted subreddit but with news and opinions about investing. This list of frequently asked questions is a good point to start with and to get back to.
- r / bogleheads – a small subreddit dedicated to long distance passive investor champion John Bogle, founder of Vanguard.
Here is a list of the best investment and finance apps, including Acorns, Robinhood , Investing.com, M1 Finance, JStock, MyStocks and StockTwits.
5. Investment Techniques of $ 100: Average Cost in Dollars
Finally, this is not an idea for investing $ 100, but a technique for regularly investing $ 100.
Average Cost in dollars where you regularly invest in the markets with the same amount. Invest every week or every month. Why? The strength lies in regular investing. You are not trying to get the best price, but you are investing. It's called DCA and it works. Here is a Reddit discussion on this.
And here's an example:
- You invest $ 100 every month on May 14: 14, June 14, July 14: the day is the same, the amount is the same, and usually the investment choice (ETF or shares, and so on) the same.
- After 12 months, a year, you invested $ 1200.
- Every time you approach a different number of shares in a stock, due to price fluctuations.
- This way you don't try to time the market, but you get more of your money on the market instead of waiting.
Average cost per dollar is a long-term approach and the opposite of day trading. It is not recommended by everyone, but it is a strategy that makes sense to many.