Investing is for everyone, contrary to popular belief that it is the domain of the rich. One does not need thousands or millions of dollars to get started. A brilliant idea and a few hundreds of dollars is all that one needs to launch an investing career. Below are some brilliant investing ideas that one can use to start a lucrative investing career, some of which require as little as $20 as starting capital.
Direct Stock Purchase Plans
Direct Stock Purchase Plans (DSPS) are suited for people who wish to gain exposure to the stock market but don’t have the financial muscle to deal with middlemen such as brokers. Just like the name suggests, investors in this case are allowed to buy shares directly from their company of choice. The benefit of this investment strategy is that one never incurs the hefty brokers’ commissions. It is also possible to purchase fractions of shares with this strategy. For example, if a stock is trading at $75 you can invest $50, for a fraction of the share.
Dividend Reinvestment Plans
With as little as $20, you can invest in Dividend Reinvestment Plans. This type of investment is suited for income-focused investors. Any dividend generated from a company’s stock can be reinvested back, in a bid to build a position and bolster the capital. Just like DSPPs, DRIPs allow investors to bypass, brokers thus save on commissions. DRIPs is one of the surest and steadiest ways to generate long-term returns with as little as $20.
In a world where people are always in need of quick money, Peer-to-Peer lending provides an opportunity to generate returns by lending out a significant amount of money to third parties. Sites like Prosper and Lending Club provide a platform where one can lend out some money and generate income in the form of interest, in addition to the principal.
Select Mutual Funds
There are mutual funds investment don’t have a minimum requirement when it comes to the amount of money one needs to start investing. There are funds that come with zero dollars requirement, suited for people who are just starting to invest. The best thing about mutual funds is that they help spread the risk given that they give one exposure to a number of assets, instead of having to invest in a single stock. Mutual funds are recommended for people who are thinking long term.
Exchange Traded Funds
ETFs are just like direct stock purchases in that they come with a low cost of entry. ETFs don’t come with a minimum requirement when it comes to the amount of money needed to launch an investing career. They trade like stocks and can be purchased for the cost of one share. Just like Mutual Funds, ETFs are for the long haul and a good place to start for an investor who wishes to have exposure to various assets instead of investing in a single asset.
Start A Business
There will always be business opportunities waiting to be explored. If you have an entrepreneurial spirit, you can simply invest in your idea and grow the business regardless of the initial capital. Even If you don’t have $500, there are other creative businesses you can start, and use them as a stepping stone for a much bigger idea.