Published On: Thu, Sep 24th, 2015

How to Start Investing with Just $100 per Month

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One of the most common misconceptions about investing is that it’s only suitable for older people and it’s risky enough to allow you to lose a great deal of money. These myths have been circulating for years, but whoever made them up didn’t want to let others in on the secret to building wealth.

Without investing – whether it’s in stocks or bonds or your retirement – you will have a hard time being able to grow your money, retire on time and develop a source of extremely passive income.

Like everything, there is a risk associated with investing, but you also take a risk when you go to a casino or step into Target. Those encounters can cause you to lose money as well. Plus, the market generates a solid return each and every year. If you start investing early, you can afford to take a little risk in order to receive a huge pay out later down the road.

Even if you start when you’re older, it’s better to contribute something vs. not contributing anything at all. Your money will still grow, and you can even start investing by setting aside $100 per month to contribute. Here’s how to get started.

Round Up $100 per Month

I know $100 may sound like a noticeable chunk of money to cut from your budget at first, but it may be easier than you think to round up that amount and get started with investing. Have you cut non-necessity expenses from your budget yet like cutting or eliminating your cable package, switching your phone service, dining out fewer times, walking or taking public transportation more or making your own coffee and lunches at home?

You could also lower your utility bills by becoming more energy efficient and unplugging most items at night. Cancel any memberships or subscriptions and search for more affordable ways to entertain yourself and exercise.

You can also bundle your insurance, raise your deductibles, reduce your extra spending money and stop outsourcing tasks that you can do yourself.

Making some of these changes and trimming your spending and expenses down will allow you to easily round up $100 that you can put toward investing each month.

Check Out Betterment

Betterment is one way many use to start investing. When you open an account, you fill out a brief survey about your investing goals and deposit or set up recurring deposits from a checking or savings account.

That’s it on your end! Betterment will take the guesswork out of investing by distributing your funds into ETFs based on your portfolio allocation whether it’s stocks, bonds, or both.

You can even open a Roth IRA with Betterment which was perfect for me because my current employer doesn’t offer any retirement benefits. Betterment fees are very low at around .15%-.35% if you deposit $100/month or more. The more you invest, the lower your fees will be.
Betterment is a safe and reliable way to invest and your investments will be protected with SIPC (Securities Investor Protection Corporation) like many other legitimate brokerage dealers.


Loyal3 is an online broker that allows you to buy and sell stocks for free. Normally, brokerages charge you up to $10 to buy or sell a stock. Eliminating that fee allows more of your money to go toward investing.

Loyal3 currently offers a select amount of stocks including big name companies but they are constantly adding to the list so more and more opportunities will be available further down the road.

Signing up for Loyal3 is quick, easy and free, plus you don’t even need $100 to purchase your first stock. The minimum investment you can contribute is $10.

Mutual Funds

Mutual funds may be an option if you can commit to contributing at least $100 per month. Mutual funds are made up from a pool of funds collected from many different investors. Money managers operate the funds and invest them in an attempt to produce capital gains and income for the group of investors.

Some companies like Charles Schwab offers dozens of different mutual funds all requiring a minimum investment of just $100 to open a regular account. This particular company absorbs the costs of administering these small accounts with the hopes that people will continue to invest on a regular basis and stay with the company over a long period of time.

A company that puts faith like that in its’ clients should really motivate anyone to get started with investing with only $100 and build a solid nest egg from there.

Have you started investing yet? What’s holding you back?
Source: The Money Chat

Sandy Smith
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About the Author

- Sandy Smith is the founder of the peer acclaimed personal finance blog, Yes, I Am Cheap where she shares winning strategies for reducing debt. You can find Sandy all around the internet taking about getting you out of debt and helping others establish small businesses. She is also the founder of Colorful Money Magazine.

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Did you know?

African Americans are significantly more likely to have some type of debt (94%) compared with the general population (82%). Credit card debt, student loan debt, and personal loans are all significantly higher in the African American community.

Source: Prudential’s 2013 "African American Financial Experience" study