i want to invest $50 dollars a month, where do i start?

Question

i am interested in investing in the stock markets. i don't know where to start and what i need to know. $50 is just the start but i am planning to invest more each month. this would be easier if i knew what to do and where to go. can anyone lead me in the right direction?

Answer 1

If you're just getting started, invest your money into a mutual fund, preferably a no-load index fund. Several of the major fund companies have low minimums *if* you are setting up an automatic monthly investment plan -- so it fits your situation perfectly. (By the way, they typically also have lower minimums for IRA or Roth IRA accounts, if you were planning to set up one of those.)

This way you don't have to remember to save up the money, it's just automatically deducted from your checking (or other) account and before you know it, you've started on the path to investing! Automatic investing is the painless way to save.

Vanguard is the fund company I recommend the most to beginners, but you'd have to start with $3000 for their S&P 500 fund ($1000 for their STAR fund), and then $50/month minimum after that.

If you don't have $3K to start, then T.Rowe Price is an excellent fund company and the last time I looked had several funds with $50 minimums:
http://www.usatoday.com/money/perfi/columnist/waggon/2007-03-29-investing-small-sums_N.htm

Check out this list for more ideas:

http://www.mfea.com/vd/fundselector/fundquicklist/Funds50Less.htm

Answer 2

Start with a seperate bank account first. Save the $50 to that until you have enough (maybe $500) to get a good first investment. This also gives you time to educate yourself about what to do

Its good that you are asking questions, but everyone on here has a different answer - no one is right or wrong necessarily, we just all have different preferences and toleration for risk. So you have to find out what is right for you.

I recommend going to the library and reading some books on personal finance and investing. Investing for Dummies and Personal Fiannace for Dummies are good. Some authors I like are Dave Ramsey, David Bach, Suze ORman, and Jane Bryant Quinn.

Answer 3

There are three good but easy approaches.

One is Sharebuilder.com (http://www.sharebuilder.com/) whose primary business is effortlessly putting a stream of payments into a stock or stocks. May I suggest a good ETF, an exchange traded fund, that buys and sells like stock, but is a whole lot cheaper, as in management fees. Without an active manager, they use a simple formula, such as hold the 30 stocks of the Dow Jones Industrial averages (DIA) or the 500 companies on the Standard & Poors list (SPY), or lots of other things (consider the Ishares link below if you would).

A second approach is go to a good mutual fund. They commonly have a small amount each month, particularly if for an IRA. Some will have minimums above what you asked for, for instance the Vanguard Dividend Growth fund is very good (https://personal.vanguard.com/VGApp/hnw/funds/snapshot?FundId=0057&FundIntExt=INT ; https://personal.vanguard.com/VGApp/hnw/funds/fees?FundId=0057&FundIntExt=INT) but requires a minimum of $3k to which you can add $100 a month, or whatever period. You used to get a $50 per month from Vanguard, but you will have to search elsewhere for such a low amount. Check the Businessweek Mutual Fund scorecard link below, then when you find something interesting, hit the link to the fund and see what their minimums are.

Finally, and this one is potentially important, is a Dividend Re-Investment Program, or DRIP. There are a couple of informative links below. Essentially, some companies pay dividends on a regular basis, certainly not all, and some of those who do have programs to reinvest dividends into their own stock, and certainly as well not all steady dividend payers do this. Over time, some who have been steadily putting money into things like Coke and several others, often utilities, have literally sown (as in planted) thousands and reaped hundreds of thousands as this reinvestment snowballed over several decades. It is as close as you will come to compound interest in the stock market. Be aware, however, that fees can be steep if you aren't careful and, especially when the accumulation gets significant, there can be strange tax consequences.

Good luck.

Answer 4

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Answer 5

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Answer 6

invest 50 dollars month start

Answer 7

You ask a very interesting question. Forget about the stock market or its promises to make money. Even if you make money, the dollar is depreciating, so you will have to make enough to make up for the lost.... due to depreciation (inflation) and then you have to face the government, which will take its taxes from your earnings.

If you have $50 to invest monthly, buy precious metals. Cash in hand, buy physical silver from coin dealers. Since this is a cash deal, there are no records of you making earnings. I bought a 100oz bar of silver for $800. A year and half later (today) that bar is worth $1,400. How about that, huh? I have to pay no taxes on that... as I would if it was stocks. You should start small.... They sell 1oz bars and Silver Dollars.... Research and make money....

Answer 8

Lots of banks have mutual funds you can link to your checking account. It will automatically withdraw a set amount every month. Takes very little maintenance and you don't usually need a minimum investment amount.

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Answer 9

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Answer 10

Investing monthly in a mutual fund would be a great idea. Your investment would be diversified among many different stocks and managed my a professional money management tearm. If you would like a little help in selecting an appropriate fund please email me. Your age, goals and tolerances for risk would have to be factored in to give you an appropriate recommendation