Investing Portfolio Management 4 Ways To Start Investing With Small Amounts of Money You can get started today with just a few dollars. By Jeremy Vohwinkle Jeremy Vohwinkle Facebook Twitter Jeremy Vohwinkle specializes in retirement planning and has experience as a financial advisor. He also started a financial blog for Generation Xers. learn about our editorial policies Updated on March 29, 2022 Reviewed by Anthony Battle Fact checked by Julian Binder In This Article View All In This Article Direct Stock-Purchase Plans Online Brokers and Investing Apps Invest in ETFs Fund Companies Offering Low Minimums Photo: ATU Images / Getty Images You needn't wait until you come up with hundreds or even thousands of dollars before opening an investment account. In the past, it was almost a requirement to have quite a bit of money available to make your initial investment in a mutual fund or open a brokerage account. Today, things are quite different. You can start investing with very little money upfront. Here's how. Key Takeaways Invest through a direct purchase plan, which lets you buy stock straight from a company and avoid brokerage commissions.You can also use an online brokerage or investing app to invest small amounts of money over time.Buying ETFs will give you exposure to multiple stocks with one purchase.Consider no-load funds that have low investment minimums, which may be easier for you to afford. Direct Stock-Purchase Plans If investing in individual companies is your goal, you might want to consider direct purchase plans or "DPPs" for short. As their name suggests, you purchase these stocks directly from the company. There’s no brokerage account and no middleman, and you work directly with the company that issues the stock. One drawback is that not every company offers a DPP, so you may be somewhat limited in your selection. Companies seldom promote their DPPs, so it’s up to you to find them. You'll probably have to spend a little time visiting a company’s website and looking through their investor relations section to determine whether or not it offers a direct purchase plan and how to get started. The real benefits of a DPP are that you aren’t paying a hefty commission to a broker, and you’re given the ability to purchase fractions of shares. For example, suppose a company you want to invest in is trading at $100 per share, but you only have $50 to invest at the moment. Through a DPP, you can usually buy just half of a share, and then you could continue to use small amounts of money to purchase more shares over time. You can’t do that with a traditional broker. Online Brokers and Investing Apps A second way to start investing with a small amount of money is to sign up with an online discount broker. Today, many online brokers offer commission-free trading in ETFs, and you can create an automatic investment plan that will help you start building your portfolio over time. Keep in mind that they may impose some account restrictions and fees, but generally speaking, it’s a great way to start investing today without much money. Another option is to use one of the investing apps that are currently so popular on the market. These apps work differently—some let you round up the change from purchases and invest the difference, while others allow you to invest in fractional shares—but they share a common goal: to help investors build a diversified portfolio with the money they have at hand, with a simple click on an iPhone or iPad. Like online brokers, investing apps can charge service and maintenance fees. The investment choices offered can vary widely; some allow you to invest in predetermined portfolios of exchange-traded funds, while others offer individual stocks. Remember that these individual investments may carry fees. If you're looking for an investing app to get started with, here are a few to consider: Robinhood Acorns Axos Invest M1 Finance Stash These apps also have different minimums for getting started. For some, the minimum is $0, but others may expect you to start investing with $100 or more, so choose the app that fits your budget and ability to invest. Invest in ETFs Are you thinking of investing in something like a mutual fund so that you can achieve instant diversification? If you don’t have a high initial deposit to make it happen, you may want to consider buying shares of an exchange-traded fund. Unlike mutual funds, which may impose a minimum initial investment, ETFs trade like stocks. They have a specific share price and can be purchased through virtually any broker. With an ETF, you can buy just a couple of shares as long as you have enough money to buy them. ETFs don’t come without drawbacks. For one thing, you have to purchase whole shares. Second, you’ll typically pay a trading commission each time you make a trade. Since commissions can generally run anywhere from $4.50 to $11, they can quickly eat into your investment. If you purchase ETFs less frequently and with slightly larger amounts of money, you can keep your transaction costs down. Fund Companies Offering Low Minimums One of the biggest and best-known no-load fund companies out there is Vanguard. For most of it funds, a $3,000 minimum investment is required, just to get started. Many people could take nearly a year to save up that kind of money if they are investing for the first time, and that is only to purchase one single fund. Vanguard isn't alone, and most of the major fund companies have steep initial investment minimums. Luckily, there are some other no-load fund families out there that cater to new investors and don’t impose such high limits. For example, you can check out Charles Schwab, which offers a low $100 minimum on its no-load funds, and T. Rowe Price, which doesn’t have a minimum on investor-class funds if you open an account with the company. These are two great low-cost fund families that make it easy for a new investor to get started with even a small amount of money. Was this page helpful? Thanks for your feedback! Tell us why! Other Submit Sources The Balance uses only high-quality sources, including peer-reviewed studies, to support the facts within our articles. Read our editorial process to learn more about how we fact-check and keep our content accurate, reliable, and trustworthy. Vanguard. "How to Open Your Account." Charles Schwab. "No-Load, No Transaction Fee Mutual Funds." T. Rowe Price. "Fees & Minimums."