How to Invest in Stocks With Little Money

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To invest in stocks with only a little money, consider participating in an employer's retirement plan, as the investments are put towards the investor's future. Consider a 401k or an IRA to accrue interest with investing advice from a certified financial planner in this free video on personal finance.

Part of the Video Series: Investing Information
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Video Transcript

So you're feeling a little light in the pocket. How do you get to invest when you don't have a lot of money? Common question in today's market. One of the easiest ways to do this is if you have the opportunity to participate in your employer's retirement plan. One of the great things about a retirement plan is many times, your employer actually will make a contribution into your account just because you're a participant of the plan, whether or not you participate or not. Many times, if you don't have a retirement plan for your employer or by your employer and you want to do some of your own investing, a great way to begin is to open up an IRA, which is an individual retirement account. Within that IRA, for a small amount of money, sometimes 100, 250 dollars, you can actually buy shares into a mutual fund that is an asset allocation mutual fund. What that means is that particular mutual fund invests in all kinds of different investments across the board. For example, it may invest in small company stocks, international stocks, real estate stocks, fixed income or bonds, and all kinds of other things, including money markets and value and growth type investments. The benefit to you is by using a small amount of money, you're able to spread your investment across lots of different types of investments without having to go out and buy individual shares in each type of stock. Again, this is called an asset allocation fund. It's one of the easiest and most simple ways for you to diversify and invest with a small amount of money.


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