How to Start Investing with a Small Amount of Money
You don’t need thousands to build wealth. You just need a plan, patience, and the right tools.
So you want to start investing but you only have $50, maybe $100, or a few hundred bucks saved up.
Sound familiar?
Most people think investing is reserved for the wealthy or those with big Wall Street connections. But today, that idea is outdated. Modern investing tools have removed nearly all the traditional barriers.
This guide will show you exactly how to begin investing with small amounts step-by-step. You’ll learn:
The best types of investments for limited budgets
How to use fractional shares and micro-investing
What apps make it easiest to start
Habits that matter more than dollar amounts
Let’s debunk the myth that investing is only for the rich.
Why Starting Small Still Works (Hint: It’s About Time, Not Amount)
The biggest advantage a new investor has isn't money it’s time.
When you start early, even small contributions can grow into something meaningful thanks to compound interest. That’s when your money earns money… and that new money also earns money… and so on.
Here’s a simple example:
Invest $100/month for 30 years at 8% annual returns = $135,939
Total invested = $36,000
Compound growth = $99,939
Let that sink in.
Starting small and starting now beats waiting years until you think you have “enough” to invest.
Step 1: Build Your Foundation (Emergency Fund + No High-Interest Debt)
Before you invest a dollar, do this first:
Set aside 3–6 months of expenses in a savings or money market account
Pay off high-interest debt (like credit cards) it’s hard to beat a 20% APR with any investment
Once you’ve built a little financial cushion, you’re ready to invest with confidence.
Step 2: Choose a Beginner-Friendly Platform
Thanks to fintech, there are dozens of investing apps built for small investors.
Here are some options:
Trusted brokers, offer fractional shares, no commissions
User-friendly, fractional shares, crypto available
Simple UI, access to stocks & ETFs, automated investing
Round-ups (spare change)Automates investing with every purchase
Look for platforms with no minimums, no trading fees, and fractional shares so you’re not priced out of high-priced stocks like Amazon or Tesla.
Step 3: Start With Fractional Shares
One of the biggest breakthroughs for small-dollar investors is fractional shares.
In the past, if a stock cost $300 per share, you had to buy a full share. Now, you can invest $5, $10, or $25 into that stock and own a fraction of it.
This means you can instantly:
Diversify
Buy quality companies
Stay consistent even with a tight budget
Tip: Set up recurring investments even if it's just $25 a week. Automating removes emotion and builds discipline.
Step 4: Choose the Right Investment Type
With a small starting amount, your best bet is broad exposure — not individual stock picking. Focus on:
Index ETFs
Examples: VOO, VTI, SPY (track the overall market)
Diversified, low-cost, and ideal for beginners
Dividend ETFs
Examples: SCHD, VIG, HDV
Offer cash flow through dividends + long-term growth
Avoid for Now:
Penny stocks
Meme stocks
Speculative crypto projects
High-fee mutual funds
Stick to simple, proven tools. You’re building habits not gambling.
Step 5: Think in Habits, Not Hype
The goal isn’t to find the “next Tesla” with your first $100.
It’s to build a repeatable system that grows over time.
Here’s how:
Automate your contributions
Increase your amount gradually as your income grows
Reinvest dividends to supercharge compounding
Avoid emotional investing ignore the hype, stick to your plan
A few months of consistency will do more than chasing fads ever will.
Example: Investing $50/Week
Let’s say you commit to investing $50/week into an ETF like VTI or SPY.
Here’s how it plays out:
$50/week = $2,600/year
10 years at 8% returns = ~$39,000
20 years = ~$122,000
30 years = ~$305,000
You didn’t need to time the market. You just needed to start.
You don’t need a finance degree.
You don’t need to be rich.
You don’t need to wait.
You just need to start.
Even if all you have is $50 this week that’s enough.
Because small steps, done consistently, lead to real wealth.
Let your money work for you one paycheck at a time.
Ready to take your first step?
Start small. Start smart. But most importantly start now.
*Disclaimer: Not Financial Advice. Investors should conduct thorough research and seek professional advice before making any investment decisions.