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If you are one of those people who feel compelled to find something — anything — to spend your money on once you get a bit extra in your piggy bank or wallet, it behooves you to find a better way to save. Many people think they don’t earn enough money to invest or can’t afford to, but this simply isn’t true. The reality is that you can’t afford not to invest if you ever want to meet long-term financial goals.
Micro-investing is when a person takes a minimal amount of money and invests it into the stock market, mutual funds or other options that can grow your investment over time. A fun and easy way to start micro-investing is to download the Acorn app. This app is available through Paypal and only requires a minimum of $5 to start. It rounds up every purchase to the nearest dollar. That extra spare change is invested into financial products that can eventually turn your spare pennies into a larger savings. Other investing apps that require a minimum investment of $10 or less include the Betterment app, Charles Schwab, Loyal3, Robin Hood and Stash. Read about the best online investing sites here.
Another pain-free way to invest money is to set up an automatic transfer from your bank account to a brokerage account. You can customize when you want the transfers to happen or you can schedule it for once a month, quarterly or annually. Some easy online brokerage accounts that are perfect for beginners include Ally Invest, OptionsHouse, E*Trade, Lending Club, USAA and Capital One Investing.
One of the easiest way you can invest without noticing is to automatically contribute money from your paycheck into your 401(k) at work. Since this money is deducted before you ever see your paycheck, you don’t have to restrain yourself from spending it foolishly. Most employers will match a certain percentage of the money that you contribute. For instance, it is not uncommon for employers to match up to 3 percent of what the employee contributes. This equates to getting free money invested regularly toward your retirement.
Although it may seem like your meager income doesn’t provide room for investments, even small amounts add up over time and will eventually reap you big rewards!