If you can set aside $100 each month, here are some great ways to put your money to work
Just because you don’t have thousands of dollars lying around doesn’t mean you can’t get into investing. We asked five of our contributing writers how they would invest $100 per month. Here are their answers.
An index-tracking mutual fund
Dan Caplinger: Many people think that $100 per month is too little to start investing, but there are actually some great choices you can make to begin an investing strategy even with such a small amount of money. One of the best ways to start is to invest in an index-tracking mutual fund, which will give you much-needed diversification despite having only minimal assets to invest. You’ll also get the certainty and stability of knowing that your investment will track the market benchmark of your choice, whether it is a popular index like the S&P 500 or a more specialized index.
Most mutual fund companies say that they want higher minimums to start a fund account, with amounts like $1,000 being fairly typical. Yet if you’re willing to make regular additions to your account on a monthly or quarterly basis, starting with $50 or $100 is an option at several different fund companies that have viable low-cost index mutual fund choices available.
Once you’ve built up a solid foundation in your index fund account, you can then branch out and take on the greater risk of individual stocks if you want. For many, though, an index mutual fund is all you’ll ever really need in order to succeed with your investing.