How can $600 grow?

Question

I'd like to invest in the long term and want to know how my principal can work for me in a quarterly way other than the stock market.

Answer 1

By itself in a bank account, assuming an interest rate that will average about 4 percent, it will flop all over the place over time, that $600 might make you $24 by a year from now, about $130 over five years, around $288 in ten years, or perhaps $715 in twenty years.

(there are several interest calculators, try the one at money.cnn.com for ease)

To quote from "Money 101"
"Since the end of World War II, the average large stock has returned, on average, more than 10 percent a year - well ahead of inflation, and the return of bonds, real estate and other savings vehicles. As a result, stocks are the best way to save money for long-term goals like retirement." and
"Individual stocks are not the market. A good stock may go up even when the market is going down, while a stinker can go down even when the market is booming."

There are some exchange traded funds (ETFs) and Ishares has a good stable of several to choose from. They trade like stocks. So if you opened a Scottrade or Sharebuilder account and plunked money into something like these stock symbols, you will need to look them up, NY, or DVY, or ISI, or IYY, then you have the potential (no guarantees, no promises, unlike banks) of making more over time. How much? No one knows, but again, they tend to average more than banks pay, a lot more, and that is just being conservative, exposing you to fairly low risk. Good luck.

Answer 2

Personally I would not invest that little money into a long term unless you plan to put more money into it every month. Investing small amounts of money is overrated because the option to have the money available to you is much more valuable in the real world, where medical emergencies and other shi#storms come at you faster than you can say bear market.