Investing on a very low budget

5 ways to invest when you don’t have much cash

You don’t have to drive a Porsche or wear a Rolex to be an investor. Anyone can invest, even if you’re on a very tight budget. With just $100 you can start your very own investment portfolio (doesn’t that sound fancy?!) and start building your way to some financial freedom.

Here’s how you can start investing, even if you’re on a low income or tight budget

Option#1 – Shares

  • The share market typically builds wealth faster than any other type of investing. And there’s no amount of money too small to invest in shares.
  • Taking your first step into the share market might seem pretty intimidating – but it needn’t be!
  • You have two main options:
    • investing in individual shares,
    • or investing through a fund – either a managed fund, or an exchange traded fund.
  • With managed funds, you pay professionals to put your cash into what they think are the best stocks.
  • Or for lower fees and diversity with how you invest your cash, try an exchange traded fund (ETF). ETFs are low cost funds that track an index and can be bought and sold like shares.
  • Check out Acorns, which lets anyone invest in ETFs. It can even sync with your bank card to round off all of your purchases to the nearest dollar, and invest the difference. Or you can invest a small amount each day, week or month, or invest in a lump sum as low as $5.

Option#2 – Savings account

  • A less risky and more traditional investment route is a high interest earning savings account.
  • Look for one that rewards you with extra interest when you make deposits and no withdrawals.
  • Use online comparison services like InfoChoice to compare some of the best options available.
  • But a warning – because interest rates are so low at the moment, a savings account is going to give you a minimal return. But it will give you quick and easy access to your cash in an emergency.

Option#3 – turn you passions into cash

  • For something a little different, invest in items you love and that might grow in value over time.
  • Think art, wine, stamps, memorabilia and so on. Whatever you enjoy!
  • The risk here is that these items don’t always provide a good return. But it’s fair to say that’s true of any investment!

Option#4 – invest in property for just $100!

Want to invest in property, but don’t have a deposit?

  • BrickX lets you can now buy a small piece of a residential property, called a ‘brick’ for less than $100.
  • Simply jump online to set up an account. Then start your property investment portfolio without ever attending an inspection or auction!
  • Make rental income and capital returns – and sell your bricks whenever you want.

Option#5 – work towards a long term property goal

So your ultimate goal might is to have a family home?

  • Then focus your investment efforts on building your savings in a high interest earning account.
  • Saving a deposit to buy property can feel like it’s taking forever. But watch the cents turn into dollars, keep adding to your savings regularly and keep a high-interest earning savings account.
  • Think about buying into a cheaper area to get yourself started – the first rung on the property ladder is always the hardest. But from there you can keep climbing!