Investing in the stock market is one of the best ways to grow wealth. When you put money into the market, you can start earning returns that compound over the long run and make it easier to build wealth.
Unfortunately, many people feel like they don’t have enough money to invest — especially if they have a lot of big financial obligations. The good news is, you don’t need a fortune to invest. In fact, if you have just $1 a day, you can open up an account with one of the best brokerage accounts available that charges no fees and has no minimum balance requirements.
If you sign up for an account today with a top broker and you invest just that $1 mentioned above, here’s what could happen for you.
Your $1 a day could turn into more money than you think
Although $1 a day doesn’t seem like much, it can really add up over time as the table below shows. It’s based on earning a 10% average annual return (in line with the S&P 500’s performance over the last 50 years) and contributing $365 a year to an investment account every year.
|
After… |
Your $1 a Day Will Be Worth… |
|---|---|
|
5 years |
$2,451.20 |
|
10 years |
$6,398.88 |
|
20 years |
$22,995.91 |
|
30 years |
$66,044.35 |
Data source: Author’s calculations.
As you can see, over time, the money really starts to add up — and the returns you earn become pretty impressive. Over 30 years, for example, if you invested $1 a day, you would have contributed a total of $10,950 of your own money — but you’d have more than $66,000 to show for it!
Your small investment snowballs far more than it ever could if you just left it in a bank account, as the stock market can provide much better returns over the long run. Your money actually works for you, instead of just sitting there losing ground due to inflation.
Start with $1 a day and go up from there
Investing $1 a day not only allows you to start taking advantage of compound interest. It also helps you to get comfortable with investing and develop the habit of putting your money to work for you.
As you can see, that single dollar can make a huge difference in helping you to become more financially secure. But the more you can contribute, the faster your wealth will grow and the better off you’ll be. So, even if you can only start with $1, do it today.
Many brokerage firms allow you to buy fractional shares, which are partial shares of stocks or ETFs, so you really don’t have to wait long to start buying investments. Then, your money can start working for you.
To get started, sign up for a brokerage account if you don’t have one already. Arrange to have money transferred over to it — you could do $7 a week or $31 a month or whatever works for you. Then, research low-cost exchange-traded funds (ETFs) that track the performance of the market and start buying them. Over time, try to increase your contributions as much as you can — chances are, you’ll be excited to do that once you see your money growing.
