Stock Up

Walking around New York City while sipping a latte and checking stocks is not typically part of everyone’s life. On the contrary, the average American’s day consists of paying a dreaded bill or two, followed by a trip to the grocery store while trying to stick to your monthly budget, leaving many people without enough money to invest—or so they think.

Cutting back on certain expenditures can help with issues that limited funds may pose. How much do you spend a week on coffee? What about lunches during the work week? Purchases such as these add up throughout the week. It’s much easier to break small habits than to overwhelm yourself with big life changes. Saving just $10 a week leads to $40 a month in extra cash. At the end of one year, you will have nearly $500 to invest.

Drips

Dividend reinvestment plans (DRIPs) allow you to invest small amounts of money into dividend-paying stocks by purchasing directly from the company. Companies like Coca-Cola, Verizon and Johnson & Johnson are just a few of the companies that allow you to make regular purchases of very small amounts of stock and reinvest the dividends. This can add up to a big investment over time.

ETFs

Exchange-traded funds (ETFs) are investments traded on stock markets, much like stocks. The ETF holds assets like stocks, commodities or bonds. You can buy as little as one share of an ETF through a broker, and some of these ETFs track the performance of the total stock market and the bond market.

Target Date Funds

Target date funds keep your retirement date in mind by changing your percentage of stocks and bonds to keep your money safe as you approach retirement age. Some of these funds require a minimum of $1,000. They are great for investors who don’t want to manage a portfolio on their own.

401(k)

If you have a 401(k), invest there first. You should always fund your 401(k) before outside investments, especially if your company is willing to match any of your funds.

Nobody wants $500 to burn a hole in their pockets. Here are some options for putting your hard-earned cash to better use. Source: