Have an extra $100 in your budget and want to invest it for the future? Although that’s not a huge amount of money, you can still put it to work for you!
There are plenty of ways you can invest with $100. In this guide, we’ll offer some creative ideas for how to invest $100. Let’s get started!
What Is Investing?
Before we dive into the best ways to invest $100, it’s important to explain investing. The idea behind investing is to put your money to work for you so that it grows over time. You can invest to save money for retirement, but also for more near-term goals like opening a business or taking a long vacation.
While most people equate the stock market with investing, the truth is that investing is a lot broader than that. Anything that helps you build wealth for the future can be considered an investment, whether it’s a stock, a new business, or even education. The most important thing is that you use the money you want to invest with an eye towards the future, as opposed to simply spending on things that don’t offer a potential monetary benefit down the road.
Can You Invest With $100?
Although $100 isn’t much money in the big scheme of things, investing with just $100 is completely possible. That said, there are some important differences to keep in mind when it comes to investing with $100 as opposed to bigger amounts like $1,000, $10,000, $100,000, or more.
When you’re just investing $100, you’ll probably want to leave behind some of the usual rules of investing. Building a diversified portfolio, for example, doesn’t make much sense when you only have $100 to invest. You’d only own a few dollars’ worth of each company in your portfolio and your potential upside is severely limited.
Along those same lines, you’re likely going to want to take on more risk when investing just $100 than you might if you were investing a larger sum. It takes a gain of hundreds or thousands of percent to make the time you spend investing worthwhile. Even a 100% gain is only $100 when you’re investing a small amount of money.
Another thing to remember is that the most you could lose if your investment goes badly is $100. So why not take a chance? Investing $100 is a good chance to experiment and try out something that you might not be willing to risk more money on.
How To Invest $100
There are dozens of different ways to invest $100. Here are some of our favorite ideas:
Use Acorns To Auto-invest
Acorns, Stash, Betterment, and other robo-advisor services allow you to start investing with as little money as you want. You can buy fractional shares of ETFs that track the entire stock market, so your $100 investment buys you an entire portfolio of stocks.
The catch is that investing just $100 in a diversified portfolio isn’t enough to change your financial situation, even if you leave the money to grow for many years to come. So, if you go with a service like Acorns or Stash, make sure you follow up on your initial investment. Most robo-advisors allow automated monthly transfers from your bank account so that your investment grows over time.
Pick A Winning Stock
Investing in a single stock is risky. But if you’re only investing $100, your potential loss is very limited relative to your potential upside. After all, if you pick the right stock, you could turn $100 into $1,000.
If you’re going to invest in stocks, especially in a single stock, make sure it’s a company with explosive growth potential. Tesla, for example, is up 644% for the year, which would leave you with a total of $744. If you invest in an established company like, say, Coca-Cola, you’re not likely to see returns in the hundreds of percent. Most brokers allow you to buy fractional shares, so don’t worry if the stock price is over $100.
Flip Products Online
If you’re willing to hustle for a profit, you can also use your $100 to buy used or collectors’ items and then flip them online. Limited edition shoes and clothes and sports memorabilia are relatively easy to get started with, especially if you have an eye for what’s valuable. You can also buy and sell items like used electronics, appliances, or sports equipment if you have the know-how to repair busted products.
Pay Off Debt
Debt can hold you back for years to come and prevent you from investing in the future. So if you have debt, putting your $100 towards paying it off is one of the best investments you can make. It not only gets you one step closer to being debt-free, but also reduces your future interest payments slightly so that you owe less overall.
Start A Simple Business
Another way to use $100 is to invest in a simple money-generating business, such as a blog. $100 is enough to buy a domain name and a WordPress template, for example. Or open up a basic storefront with an eCommerce site like Etsy or Shopify.
Alternatively, you can put the money towards online ads to market yourself as a freelance writer, a virtual assistant, or anything else you’re skilled at.
One of the best ways to use $100 is to invest in your own education. $100 won’t put you through college, but it could buy you a stack of books about investing or budgeting that help you earn more money down the line.
You can also use the money to sign up for an online course about whatever topic interests you. Masterclass offers an all-access pass to hundreds of online classes for just $180 per year.
Conclusion: Investing Your $100
Investing $100 can help you take a small amount of extra money in your budget and put it towards your financial future. While this isn’t a huge amount of money, there are plenty of options for how you can invest $100. Be creative and consider taking risks that you might avoid with a larger investment.