Several people tend to wait for the perfect time before starting an investment. Others wait up until they have accumulated enough money which made sense a couple of years back mainly for these reasons;
- Back then, mutual fund companies require a high minimum, as high as $3,000.
- Back then, brokerage firms are charging their clients high fees, resulting in loss of returns for small accounts.
Thankfully, these reasons from years ago are now being eliminated as investment providers start offering low-fee, high-quality investments for as low as $50 for starters and even lesser in other cases. If you are interested in investing as low as $50 in the stock market, you should read more below.
Start Investing in the Stock Market For $50
But don’t get too excited. Before investing in the stock market or Forex trading, make sure that your investment makes financial sense. One of the reasons that hinder other people from investing is because of high-interest debt. If you are still buried with credit card debts then it might be good to reconsider investing.
Why? This is because the average return of investment in the stock market is about 7% every year. But if you have a debt with a rate much higher than 7%, then it is wise to pay it off first as this can be considered as your best investment for the time being. Paying off your debts also have guaranteed returns, which the stock market cannot guarantee you.
The next thing you need to consider before investing in the stock market is the fact that it requires a long commitment. One of the greatest and most successful investors of all time, Warren Buffett once said that “our favorite holding period is forever.”
Therefore, if you choose to venture into the stock market, you should have the mindset that considers stock investment as a long-term investment. If you think that you will need the money you invested after a month or a year, then the stock market or even the Forex trading is not for you.
Best Place in Invest As Little As $50
This is known to be a robo-adviser. What makes it one of the best places for small investments is the fact that starting up is super simple. Instead of being torn between hundreds of mutual funds, it first provides a questionnaire that you should answer. After providing the answers, you will be given refined options based on the answers you provided.
Another good place to start stock investment is M1 Finance, This platform is allowing for much better customization of the portfolio. For instance, you want to invest 90% of your overall portfolio into the index funds, while the remaining 90% is for the individual stocks. This arrangement is allowed on the platform.
Another alternative option is the Acorns, a micro-investing application. In this platform, you are allowed to make automatic contributions and it is also well-known for its round-ups feature. Every time you purchase something, the app rounds it up to the nearest dollar. Once every day, your spare change will then be invested into your portfolio.