How to Invest $100 a Month in Stocks for 30 Years?

Oct 09, 2023 By Triston Martin

It is possible to begin investing while you are still in high school, while you are still in college, or even when you are in your 20s. Even more fuel for contemplation is that a $100 investment in Apple shares made in the year 2000 would be worth $2,300 in today's market. Or, if you put the same money into Amazon stock simultaneously, you'd have well over a thousand dollars now. And that's assuming you only made one investment of $100. Imagine you had put away $100 every month since the year 2000. You'd have much over $20,000 in your bank account right now. I hope this will serve as a source of inspiration for you and demonstrate that you do not need a large sum of money to begin investing.

Where to Invest Your First Hundred Dollars

If you want to begin investing, the very first thing you need to do is sign up with a brokerage business and a financial institution that offers investment accounts. It would help if you didn't let it worry you since brokers are exactly like banks, except that they specialize in keeping investments. Even better, we keep a list of the finest brokerage accounts, complete with information on where to locate the most attractive bonuses and the most reasonable fees: Best Online Stock Brokers.

Because you are just beginning with $50 or $100, you will want to ensure that the account you register has no account minimums or very low account minimums, as well as cheap fees. M1 Finance is our go-to recommendation when beginning our investment career to invest. What is the cause? You won't have to pay fees, and you'll have free reign to invest in almost whatever you choose. Keep in mind that placing an investment with many brokers will cost you anywhere from $5 to $20 in the form of a commission. Because of this, if you do not choose an account with minimal expenses, you might lose anywhere from 5% to 20% of your initial investment.

What Kind of Account Should You Get Started With?

Your second choice is determining the investment account you want to set up for yourself. Because there is such a wide variety of accounts to choose from, the answer relies heavily on the objectives of your investment. Your primary emphasis should be on retirement accounts if you are making investments with a view toward the long term. You should keep your money in taxable accounts if you are investing for a period that is less than a decade. The following is a chart that should help you make sense of all of this:

Where to Put Your Money

The next obstacle is deciding where to put your money. If you make smart investments with your money, $100 Stocks may become much more than that over time. If you place a wager on a stock, you risk losing all of your money. And it is a bad way to get started in the investment world. Nevertheless, losing all of your money via investing is quite unusual. As you get started, investing in an index-focused exchange-traded fund with a low expense ratio should be your primary goal. Wow, it certainly seems like a lot to take in at once. But in all honesty, it's not that complicated. ETFs are simply baskets of companies that follow a certain index, and they are an investment option making a lot of sense for new investors.

An Example Using Monthly Investments of $100

Now let's assume that the same investor who is 30 years old discovers a means to save an extra $100 per month. He adds the additional one hundred dollars to his investment portfolio and continues to reinvest all of his dividends and interest payments. His investment is still generating 8% annual interest for him. Let's suppose that compounding happens just once a year, in January, to keep things simple. His portfolio will rise to $186,253.14 over 30 years, owing to compound returns and a tiny monthly payment (compared to $50,313.28 if he did not make the monthly contributions), according to the combination of these two factors. It is important to remember that although $186,253.14 is not enough money to retire on, particularly after 30 years of inflation, this projection is based on just $100 being contributed each month and lower returns than the historical norms.

Think About Making Use of a Robo-Advisor

Consider hiring a Robo-advisor like Betterment if you are still unsure where to put your money or what to invest in. Betterment is a web-based service that will take care of all the "investment things" on your behalf. Betterment takes care of everything once you deposit your money (the smallest amount required to start an account is zero dollars), so all you have to do is make the deposit.

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