How to Begin Investing with as Little as $5 Today!
Wow, we are already halfway through the Beginner Investing Series and I have thoroughly enjoyed writing about some of the things I have learned along the way from my own investing journey.
Of course, this particular series was always meant to be simple and basic, but it was meant to get right to the crux of what I wish I had known before I started investing.
Today though, I will go through how my investing journey began, to give you a great picture of how you to may be able to to start investing with as little as $5.
First of all, my investing journey began after reading “The Barefoot Investor- The only money guide you will ever need.” [1]
Not unlike what you are doing right now, by reading my blog series, I started by just simply seeking to understand how I could make myself more financially savvy and also so I could save up a deposit to buy a house with my wife.
Reading the book, produced a spark that led to me taking action and implementing the steps to help my wife and I to save a deposit for our house, start investing outside of Super and to truly set ourselves up financially.
The spark gathered momentum and I started delving deeper into understanding finance, reading Tony Robbins, “Money: Master the Game” [2] was taking it to another level again. (For a more basic and stream-lined version, check out “Unshakeable.” An amazing read and a must if you want to start investing.)
I can hear you saying, ok but where can I start investing right now, for as little a $5?
Well rest-assured, here it comes…
I want to introduce you to the world of micro-investing!
Yes, if you believe it, you can actually invest your money in an app starting with as little as $5, some may even be as little as $1.
I started my own investing journey using the micro-investing app called Spaceship [4] and I invested using Spaceship up to the point where I felt finally comfortable and knowledgeable enough to take on the markets myself.
Why did I do it and therefore why should you consider it as well?
Time in the market is more important than timing the market
What do I mean by this, I mean that over the long-term, you are more likely to earn a good solid return by having your money in the markets than if you were to try and time it by waiting for everything to dip.
I learned that its better to start investing now and micro-investing apps actually make it possible, rather than waiting to save up $2,000-$5,000 to invest into an ETF, you can start NOW!
2. You can learn by putting some skin in the game!
Learning about your own behaviour whilst having some money in the market was probably the most important aspect I learned and what you can learn with small amounts of money, rather than risking big amounts to start with.
You can learn how you behave when their is a correction in the market (when shares drop by up to 10%, meaning you lose 10% of your money) which is vital to your investing career. Do you pull out because you don’t want to see yourself losing more money? Or do you wait it out until the market goes back up, no matter how long it takes?
Learning this early on has been vital to my own investing success so far. In the last year alone, my own portfolio has grown by 20% and retracted by 10%, but if you do the math, it means it is still up!
3. Finally, it gives you time to research how the market works!
The most important aspect of micro-investing, at least what I got out of it the most, was that I had time to put some money in the market, whilst researching and learning more and more.
You have first-hand experience and you can delve even deeper again by researching into different investment funds, listening to podcasts and learning as much as you can about investing.
If you don’t want to do this, you probably are not cut-out to do active investing, as you need a sound amount of research and knowledge to actively invest.
You may be better off, when you have built up enough money in your micro-investing portfolio, to either seek an advisors guidance or to sink most of your portfolio into ETF’s (exchange traded-funds) that follow a specific index.
I will actually be running through the difference between ETF’s and managed funds in my next blog, as I believe it is really important to understand.
I hope that helped you and if you are interested in micro-investing, it is best to do your research, as Spaceship is not the only app you can start investing with. Another product you could look into is Raiz, but I would highly suggest reading through the PDS and understanding what each investment in the app entails.
At the time of writing, I do not hold any funds in any micro-investing apps.
Until next time,
Take Back Control.
If you have found this Blog valuable, I would love it if you shared it with friends and family. The more the merrier, as I want to see each and every one of you learn to Take Back Control of your Life-Health-Wealth !
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References:
[1] - To check out Scott Pape’s book, click the link - https://www.amazon.com.au/Barefoot-Investor-2018-Update-Money/dp/0730324214/ref=asc_df_0730324214/?tag=googleshopdsk-22&linkCode=df0&hvadid=341744699688&hvpos=&hvnetw=g&hvrand=7682030752416799449&hvpone=&hvptwo=&hvqmt=&hvdev=c&hvdvcmdl=&hvlocint=&hvlocphy=9072139&hvtargid=pla-407488791778&psc=1
[2] To check out Tony Robbins, Money: Master the Game, click the link - https://www.catch.com.au/product/money-master-the-game-7-simple-steps-to-financial-freedom-book-by-tony-robbins-796952/?offer_id=37134769&ref=gmc&gclid=Cj0KCQiA15yNBhDTARIsAGnwe0VRyuWdatGHDWjUxavDFYUbByQnFrcymYiK0YJQ-0sLIv240boZhYUaAlxxEALw_wcB
[3] To check out Tony Robbins, Unshakeable, click the link - https://www.amazon.com.au/Unshakeable-Your-Guide-Financial-Freedom/dp/1471164950/ref=asc_df_1471164950/?tag=googleshopdsk-22&linkCode=df0&hvadid=341744699688&hvpos=&hvnetw=g&hvrand=14442430285955173354&hvpone=&hvptwo=&hvqmt=&hvdev=c&hvdvcmdl=&hvlocint=&hvlocphy=9072139&hvtargid=pla-672857091020&psc=1
[4] Spaceship website - https://www.spaceship.com.au/
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Disclaimer:
General Advice Warning
The information contained in this blog is general in nature and does not take into account your personal situation. You should consider whether the information is appropriate to your needs, and where appropriate, seek professional advice from a financial adviser.
Taxation, legal and other matters referred to on this website are of a general nature only and are based on Take Back Control’s interpretation of laws existing at the time and should not be relied upon in place of appropriate professional advice. Those laws may change from time to time.
