How to make room in your monthly budget for investing if you lack the capital (guest blogger – Andrew)

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Hi Team,


Today we’re lucky to have with us Andrew from SlickBucks – where you can find some great posts about investing, saving, and building wealth. In this post, he covers some solid options for investing if you lack the capital. Be sure to let him know what you think in the comments section and check out some other posts he’s written for his site. As always, thanks for being here!





If you’re young, broke, or young and broke, you’re probably tired of hearing the maxim “it takes money to make money”. What are the rest of us supposed to do, then?

Living paycheck to paycheck isn’t a sustainable way of life, so you need to find investment strategies that will work even if you don’t have much capital.

The Mindset: Goals and Saving

It’s hard to start investing, but you should start by thinking of what kind of projects, investments, and ideas you’ll fund with your money once you have it.

Are you, for example, investing so you’ll have money to send your kids to college? Maybe you’re investing for your own retirement. Heck, maybe you’re just investing so you’ll have more money to invest in the future.

If you don’t define your goals, you’ll never find an efficient way to reach them.

Before we look at investment opportunities, we’d like to clear up a pervasive myth: although there are risks to investment, it’s not “gambling” perse, although those looking to “get rich quick” almost never do.

That’s because nearly all of the best investors have something in common: they’re all good at saving money.

If you’d eventually like to be able to invest larger sums of money, you need to get in the habit of setting a comfortable amount of money aside from each paycheck you get. Even a low-interest savings account is better than nothing when you’re just getting started.

Investing in Your Future: 401(k)s, IRAs, and Target-Date Funds
Retirement is obviously one of the biggest goals for long-term investments. If you’re just getting started investing, you should consider investing is your company’s 401(k) (or potentially 457(b) or 403(b)). This is especially true if your company matches your contributions.

If your company doesn’t offer a retirement plan, or if they don’t match employee contributions, you can start investing in your own IRA.

Target-date funds are a good way to tailor your investments to your retirement timeline. Though these funds can often require at least $1,000 as a minimum investment, they are a good hands-off option for people who aren’t comfortably managing their own portfolio.

New investors should beware of target-date funds that charge high fees.

Shorter-Term Investment Options:

Here are a few of the best investments you can start making without much capital.

One of the most common investments for beginners is a DRIP, or Dividend Reinvestment Plan.

With DRIPs, you can invest a small amount of money into a stock that pays dividends (public corporations aren’t required to pay dividends). Investors can purchase directly from a slew of major companies.

While the returns aren’t as high as other higher-risk investments, DRIPs are a good way to “dip your toes in the water” and build toward larger investments in the future.

ETFs (exchange traded funds) target specific sectors of the investment world. It’s still diversified because an ETF is usually made up of many companies.

Like DRIPs, ETFs pay dividends and offer good diversification without a lot of work. Fortunately for beginners, you can often buy as little as a single ETF via a broker.

A fund’s expense ratio is a good way to assess its overall cost–beginning investors should look for expense ratios below 0.50%.

Other Options

If you’re struggling to get the money together to invest, you might want to consider a few other investment options. We admire the initiative and drive it takes to change your situation even when your finances aren’t ideal.

Certificates of DepositCDs are a great no-risk option to start making your money work for you. While the interest rate isn’t very high, Certificates of Deposit provide a valuable lesson in patience to new investors who aren’t yet comfortable with “letting their money sit around”.

Treasury Securities–While they most likely will never make you rich, treasury securities (savings bonds) still represent one of the best low-risk “investments” if you’re low on cash. With maturity dates ranging from just a couple of days to many years, it’s easy to find one that fits your budget.

No matter your goal and available budget – there’s something out there for you if you just decide to go grab the „investment bull“ by its’ horns!


Thanks for reading!


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I’m glad you’re here. Thanks again and talk soon!


– Mike
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