Yes, you CAN invest small money like $100 in some very good investments in 2011 and in the future under certain circumstances. In fact there are good investments offered by some of the best fund companies that were designed originally for the small investor. Here's how to invest in them.
Whether you invest $100 or $100,000 in 2011 or later, you will need to first open an account. This means that the party you invest money with will incur expenses to open and service your account. Hence, even the best fund companies have a minimum investment policy. A one-time investment of $100 is not attractive or practical for them. However, $100 or MORE a month on an automatic investment plan is another story. I suggest you invest your money in the bank until you have a few thousand in cash reserves. Then, when you can afford $200 or $300 a month... here's how to invest in an assortment of good investments called mutual funds.
Do not feel intimidated by the fact that you can only invest small amounts of money and/or you don't know a lot about where or how to invest. If you start to invest money in 2011 in solid good investments and continue on a monthly basis you're on your way to a better financial future. That's why some of the biggest and best fund companies cater to small investors with an AUTOMATIC INVESTMENT PLAN. Over time small investors can accumulate a substantial sum of money in an IRA account, for example. And the more money you have invested, the more money fund companies make.
You can find some of the lowest cost and best fund companies by searching "no-load funds" on the internet. See what they offer and what their minimum investment is for an automatic investment plan (monthly investments). Then call them up toll-free with any questions you have and ask for a starter kit and info on the funds they offer. I consider the following to be among the biggest and best fund companies: Vanguard, T Rowe Price, Fidelity, and American Century. You can invest money in good investments called mutual funds without paying sales charges or "loads" in any of their no-load funds.
Normally, when you invest by the month fund companies have you fill out a form so they can take money directly out of your bank account. These plans are not contractual with the best fund companies, so you should be able to stop the withdrawals or cash in at will. Now let's look at how to invest for 2011 and beyond if you want a diversified portfolio of good investments with only moderate risk. We'll say you want to invest $100 a month into three different funds with the same fund company.
Invest with $100 going to a general money market fund, $100 to an intermediate-term bond fund, and $100 to a general diversified large-company stock fund. This gives you a balanced portfolio of money market securities, bonds and stocks. You're then good to go with good investments in all three basic asset classes, and overall portfolio risk is only moderate. If you want a tax break when you invest money and accumulating money for retirement is your goal consider an IRA account... IF you qualify based on IRS regulations.
Otherwise, you can simply have an account in your name only or a joint account with your spouse like at the bank. Mutual funds are the original good investments designed for investors who want help managing their money. When you invest money in funds in 2011 and beyond you simply pick the funds and they do the rest. With the best fund companies your total cost to invest can amount to less than 1% a year! Look no further for good investments, year in and year out.
A retired financial planner, James Leitz has an MBA (finance) and 35 years of investing experience. For 20 years he advised individual investors, working directly with them helping them to reach their financial goals.
Jim is the author of a complete investing guide, Invest Informed, designed for average investors or would-be investors of all levels of financial background and experience. To learn more about investments and investing and his new financial guide go to http://www.investinformed.com.
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