How To Start Investing With Only $100？

Investing for the first time, or just thinking about it, you may believe you need a lot of money ready to get started. That's not true. If truth be told, you can start investing with as little as $100-and in a very short period of time you can turn this into $1,000, even $10,000. When it comes to investing, the best step you can take is to start small rather than start big.

One of the ultimate goals of investing is to understand how to make your money work for you instead of the other way around. Whatever kind of investment you choose, whether stocks and bonds, real estate investments, or foreign exchange markets, the ultimate goal is to boost wealth profits through additional income. Investing is a crucial part of the process of saving for a good retirement, as well.

As opposed to waiting until you have $1000 to invest, invest $100 now to make $1000. A total of 11 easy ways to get started are listed below:

1. Try Forex Trading

Investing with a brokerage account could be a good idea for someone who has less than $100. Trading forex does not necessarily cost much, as many brokerage houses, especially big players in the forex industry, offers micro accounts only requiring as low as $5 or $10 to trade with them.

With a low minimum account size, you can test the waters with a broker's live account without putting much money at risk. Traders can also use them to live-test trading techniques, which is useful for developing strategies that depend on real execution conditions. Trading with tiny quantities can also allow you to focus solely on one trade at a time. This relieves a great deal of pressure, allowing you to devote your full attention to a particular trade. in this way, you can gradually expand the number of positions you can manage simultaneously, allowing you to handle more stress and data.

Since there are many forex brokers with requires a small amount of initial capital in the market, choosing a proper one is not an easy task.

For your convenience, a list of 10 Best Low Deposit Forex Brokers in 2022 selected by WikiFX can be view through the following video:

2. Invest in Savings Bonds

Investing in savings bonds is a safe option for those who are concerned about risk. By purchasing a savings bond for its nominal value, you will receive interest when the bond matures. It is possible to cash in bonds at any time, but the longer you wait, the more valuable they become. In fact, many bonds are expected to double in value by the time they reach maturity.

Savings bonds can be classified into two types: I Savings Bonds and EE Savings Bonds. Both the I Savings Bonds as well as the EE Savings Bonds have their own advantages and disadvantages. In cases where inflation is high, you are likely to earn interest on I Savings Bonds, but it is unlikely that you will be guaranteed a 2x return on your investment, as you will with EE Savings Bonds. With the cost of bonds starting at just $50 per piece, you can consider them as one of the best ways to begin investing with just $100.

3. Consider Using a Robo-Advisor

It can be overwhelming to manage your own investment accounts if you're brand new to investing. While there are some individuals who have some experience in managing an investment portfolio, the majority may not have the time or desire to take the time to do the research and effort necessary to keep it well invested and diversified. This makes robots a great option for putting together an excellent investment portfolio. The use of Robo-advisors can be an affordable alternative to traditional investment managers or firms. Robo-advisors, by definition, use algorithms and advanced software to manage your investments, and trade and buy stocks for you. It is possible, however, that they will help you optimize your returns by combining algorithms with human insight in certain cases. The minimum investment requirements for Robo-advisors depend on the platform and can range from zero to a low amount.

There is no minimum deposit required to start using robots like Betterment, Ellevest, or Bloom. Therefore, you can get started investing with them without spending more than $100.

4. Investing via a micro-investment app

The advantage of micro-investing is that it allows people to start investing with a small initial investment. Little amounts of cash can accumulate as time passes. Consider investing in a micro-investment app that offers educational tools that allow you to learn both your risk tolerance and your investing strategy. For instance, low-priced stocks (such as penny stocks) may appear to be an excellent investment, especially when discussed in investing forums, but they can be risky investments that are better suited to more seasoned investors.

It doesn't hurt to put your savings to use with a high-yield savings account that offers compound interest if you have a low-risk tolerance.

5. Establish a Side Business

An excellent way to invest $100 is to start a side business. There are many other sides hustles you can do with your $100 for much greater returns; you can write articles, take care of pets, or even purchase some items to sell on some social media platforms like Facebook and eBay.

A side hustle allows you to earn hundreds to thousands of dollars, even more per month depending on how hard you work. As such investments might potentially contribute to your income streams regardless of what happens in the stock market, such investments might be potentially beneficial for your finances.

6. Take a Look at P2P Lending

Have you ever thought about lending money and making interest on it？ That's what peer-to-peer lending is all about. These loans are funded by individuals directly, so financial institutions do not have to be involved. Peer-to-peer lending sites are popular with people looking for personal loans for debt consolidation, for example.

As the risk of your loan increases, you will earn a higher interest rate. As a result, your earnings are based on the types of loans you take out. Also, you should check the percentage of defaults before selecting a company. Peer-to-peer lending is quite popular, but some require large investments.

Investors who open an account with a P2P platform have their deposits distributed into a wide range of loans that are approved by the platform. The principal idea is that you lend your money and get interests in return. The risk level of every investor may vary depending on the borrower, but P2P has the potential to earn a higher return. You can, for example, have your $100 invested in four loans, allowing not only for better risk diversification but also for a greater return on investment through installment loan interest payments.

7. Invest in Cryptocurrency

Cryptocurrency refers to digital currencies like Bitcoin and Ethereum. Despite crypto being incredibly volatile, many experts remain optimistic that crypto will be widely adopted within the next few decades despite still being in its infancy. For example, industry analysts forecast that one Bitcoin will be worth more than $200,000 in several years.

Investing in Bitcoin and other cryptocurrencies is possible through many reputable platforms. The process of setting up an account and funding your crypto purchase can be completed within a few hours.

Depending on your profit goals and trading needs, you can buy more cryptocurrency, trade it, or sell it. As of today, BlockFi lets you invest in bitcoin, ether, litecoin, and paxg, as well as USD-based stablecoins like USDC, USDT, GUSD, and PAX.

8. Just Trade Financial Shares

Perhaps you would just like to invest in the stock market. If you plan to invest for the long term, like several decades, then you should consider this option. If you need your $100 to increase right away, you shouldn't use the stock market because it goes up and down frequently. Otherwise, you'll end up finding yourself constantly checking your investments.

$100 would let you purchase a few shares of a low-value company, or you could purchase some fractional shares of revenue-generating companies. It may be easier to purchase a fractional share through a brokerage such as Stash, a micro-investing app where you can start investing with $1. There are hundreds of stocks and nearly 2,000 ETFs available for investing.

9. Open an IRA

Individual Retirement Accounts (IRAs) allow you to save money for retirement, and they have various tax advantages. In spite of participating in a retirement plan through your employer or not, IRAs are a great way to boost your retirement savings - an important factor if you consider that 50 percent of Americans have less than $100,000 saved up for retirement. In other words, opening an IRA is crucial for changing this situation.

IRAs come in two types: traditional and Roth. Traditional IRAs provide tax-deferred growth. In other words, the money you contribute to the IRA is pre-taxed; you will not be taxed on it until you withdraw it. A Roth IRA is a tax-deferred investment vehicle, which means that you pay taxes on the contribution amount, but you won't pay taxes on withdrawals when you retire.

In 2021, the annual contribution limit will be $6,000, except for those over 50. When you are over 50, the contribution limit will be $7,000. Using $100 as a starting point for investing in an IRA is a great idea, regardless of which one you choose.

10. Use Fractional Investing

Fractional investing is an excellent method for gaining access to investments. Fractional investing involves purchasing a portion of stock (or a fund) shares, without the need to purchase a whole share. This will allow you to get started earlier since you do not have to buy the whole share.

You can buy fractional shares of stocks and funds on some reputable investing websites. With this approach, you can build a diverse portfolio without having to invest a lot of money upfront.

Some investing websites dont have account minimum requirements, which means that you can invest as little as $1.

Make a plan to invest a certain amount each month, and continue to buy fractional shares using that money. In the end, you will benefit as the value of your portfolio grows. If your financial situation improves and you have more money available to you, you should try to purchase additional shares.

11. Earn Interest With a High-Yield Savings Account

$100 can be deposited into one of the best high-yield savings accounts, where it will continue to grow over time. Ensure you carefully read the terms and conditions when choosing a savings account. Furthermore, you may have to pay a monthly maintenance fee or an ATM withdrawal fee if you do not have enough money in your account. These types of fees are likely to significantly reduce your balance.

In addition, some accounts will claim you can earn interest, but then reveal there is a huge minimum investment amount required. There is, however, the CIT Savings Builder, which offers a Monthly Savers Account. $100 is all it takes to qualify for the current average percentage yield (APY). With no fees on ACH transfers between your Savings Builder account and another bank account, you can easily transfer money into your Savings Builder account without having to pay anything.

However, remember that a high-yield savings account's interest rate can change at any time depending on the bank's discretion. Any time you notice you're earning less interest, you can always ask the bank why that's happening or if there's anything you can do to increase your interest.