Beginner’s Guide to Investing: Tips for Debt-Free Investing

Beginner’s Guide to Investing: Tips for Debt-Free Investing

Investing is a beautiful idea for your future, and despite what people might think, there are various ways to invest without going into debt. But, more importantly, it’s essential that you find ways to invest without going into debt. Many people think it is only those who invest thousands upon thousands of dollars into the stock market or cryptocurrency that end up being able to make money or invest at all, but that is not the case. There are various ways to invest little by little—and you don’t need thousands of dollars to do so. This article will discuss how to invest without going into debt, as well as the top ideas you could use today to help build your wealth and prepare for your future.

Where to Begin with Your Investments

When it comes to your investments, it is critical that you start on the right foot. Of course, nobody is perfect, but if you can start with an optimal situation, every investment you create will be beneficial, and you will see returns rather than struggle along the way. Here are some tips that I offer to everyone looking to invest, especially if they are beginners.

Do Not Spend Your Savings

If you want to be financially secure, the number one tip that I offer everyone is to avoid spending your savings on investments. The last thing you want is to save all of this money for a rainy day and then decide to invest, only to need it in the event of a disaster. For example, you might have a car breakdown or need some cash because you’re laid off. Emergency savings exist for a reason, so don’t spend this on your investments. Find other funds to invest!

Budget and Plan Accordingly

It is also essential to choose to budget and plan accordingly even before you begin investing even the smallest amount of money. Make sure you know what you are capable of and don’t go above your means. If you only have about $200 in extraneous income, don’t go investing $500 and put it on a credit card. investments should be coming from extra cash you have coming in, rather than taking from essentials in your budget or credit lines. Top investors know this and throw in their extra cash into their investments once their savings is set up!

Ensure You Participate in Debt-Free Investing

No one wants to be told that they can’t afford to invest yet, but if you have no extra cash, it’s always better to wait and save for an investment account. Never sacrifice your financial well-being when it comes to investments. There will always be a bit of risk involved, but make sure you don’t put too much on yourself at the start.

Top Ideas for Investments Requiring Less than $500

Once you’re prepared to invest, it’s time to look at some of your options. So many online options allow you to invest with as little as $100, and sometimes, not even that! Here are my top recommendations for those who want to invest small amounts as beginners.

Invest with Your Change with Acorns

One of my absolute favorites is called Acorns. This program allows you to invest in your change. For example, when you connect your bank account or credit card to this application, you can make a purchase, and round it up to the nearest dollar amount. Acorns will take the remaining change from your purchase and put it into an investment account. So, when you buy that coffee, and it’s $2.89, the additional $.11 will be put into your investment account. It will be divvied up across multiple different stocks or ETFs, depending on your desired risk level. I highly recommend this for anyone who wants to start investing, but might not have enough for other investment options!

Reinvest Your Cash Back from Credit Cards

Did you know you can use your cash back from credit cards to reinvest? This significant and profitable venture allows you to spend money and then use the cash back you’re already receiving for good. One of my favorite programs that does this is called the M1 credit card,” as they offer cashback to be repurposed and reinvested. They also have their own investment portfolio application, making it convenient for you to check on your investments whenever you’d like.

Start an Investment Portfolio with as Little as $10

If you’re looking for something more substantial that can grow over time, maybe it’s time for you to consider an investment portfolio. Betterment allows you to invest with as little as $10, and you can create your portfolio over time. Using this application, you can invest as little as $10 per month and eventually allow your account to grow to over $11,000 over 30 years. Now, change that investment to $1000 by the time you can invest more, and you’re looking at over $1.1 million in savings!

Leverage Your Employer 401(k)

If you’re already working for an employer, you likely already have a 401(k). This is the perfect opportunity for you to truly invest in what’s already available. In most cases, your employer will be able to match what you contribute. This is an excellent decision for those who don’t have extra cash on hand but simply just want to invest and prepare for their retirement.

Join Real Estate Crowdfunding

Real estate crowdfunding is one of the most incredible investment opportunities available due to the Internet. You can invest for as little as $500 in a property, earn money back on your investment, and be able to take part in a new form of real estate investment.

Choose Your Path Today

When it comes to investments, there are many debt-free investing options to help you get started. With any of these options, you’re looking at a potential for significant income and even, if you play your cards right, early retirement. The choice is yours!