Money & Career

Make Those Money Moves: How Millennial Women Can Invest Without Having A Lot of Cash

Black woman putting money into savings jars Getty Images
Ashley Fox
Aug, 02, 2018 3:03 PM UTC

The revolution continues. and millennial women continue to venture into entrepreneurship and excel at their professional careers. We are working extremely hard and we are increasing our earning potential while doing it. As we continue to progress, we must value our money just as we value our success. Too often, we are saying, “Where does my money go?, “Am I spending too much?”, or “Why do I always feel like I never have money at the end of the month?” These are the negative questions we constantly ask ourselves and that must change. Instead, we should be asking, “Is my money working hard for me, or am I solely working for it?” It’s time for us to elevate our level of thinking. The game of wealth has never been about making money and spending it. It is about making money, and growing it.

By changing our outlook on money, we can develop an investor’s mindset over. a mentality that is focused on consuming. Investing is what creates true economic power, and it is a great avenue that is used to reach financial prosperity. We can no longer use the “I don’t know how to invest”, or the “I don’t have money” excuse. It is an old way of thinking, and it will, by no means, help strengthen the communities we come from. It is time to focus on taking the necessary steps, so if you are someone who doesn’t have much money, but wants to invest, here are three ideas to consider:

  1. Invest in fractional shares.

There are Fortune 500 companies that are worth billions of dollars, and the Black community, in particular, has helped them become financially successful. Each year, over $1.1 trillion of our hard earned income is spent, solely, on products and services while we neglect the concept of buying stock in the companies that thrive from our consumption. In order to start building wealth effectively, we have to realize that we do not need millions of dollars to begin investing. We just need the confidence and the tools to move forward. You may need a lot of money to build your own Fortune 500 company, but you definitely do not need a lot of money to invest in a publicly traded one (stocks).

Before you say, “I don’t know what to invest in”, start by making a list of the top 20 publicly traded corporations you constantly give your time and money to. Once you make your list, do your research on each corporation, Google their stock prices, then open a brokerage account. If you find yourself having less than $200 to invest, open a brokerage account that allows you to buy fractional shares of companies. You may not have all the money you need to purchase one full share of a company, and that is ok. Companies like Stockpile have great brokerage accounts that allow you to buy a fraction of a share for as little as $5.

2. Invest in Low Minimum Mutual Funds

If you are not comfortable with investing in individual stocks on your own, let an experienced fund manager do it for you. Mutual funds can be a great way for you to invest your money, but in a diversified way. Instead of trying to decide what to buy and when to buy it, a mutual fund manager picks and monitors investments for you on a daily basis.

Most mutual funds have large minimum requirements, but do not let that deter you. Believe it or not, you can invest in mutual funds by starting with just $100. Mutual funds can be an affordable investment that provide diversification as well as a safer investment (when compared to picking individual stocks). Start by looking into prominent firms like BlackRock Inc. and Charles Schwab as they are known for offering low minimum mutual funds for $100 or less.

3. Invest in ETFs

An exchange-traded fund (ETF) is similar to a mutual fund. The fund is compiled of companies in a respective industry or sector; however, unlike a mutual fund the fund managers do not monitor the fund daily. Many people prefer ETFs because they charge lower fees than mutual funds while achieving a comparable level of growth. You can also gain exposure to hundreds of companies without individually picking them like stocks.

Investing in ETFs eliminate the stress of trying to pick the “right” stocks. Similar to stocks, you can also purchase fractional shares. So, if you are only starting with $100-$200, ETFs can help grow your portfolio. Stash is a great app that allows you to invest in ETFs, for as little as $5. Apps like Stash help you to mindlessly build wealth and they eliminate the headache of picking your investments. Most importantly ETFs, mutual funds, and stocks allow your money to work for you, instead of you, solely, working for it.

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