Before the Internet, you needed thousands of dollars to make an investment that would generate a decent return. But the Internet and smartphones have made it much easier for anyone to invest, even if you only have a small budget.
An app like Acorns, for example, rounds up the purchases you make with your credit or debit cards and invests that spare change for you. Sounds interesting? Read more about it in this Acorns app review. It suffices to say that today, there are plenty of ways to save and invest your money.
However, statistics show that saving is not as simple as it seems (let alone investing). Apparently, 65% of Americans save little or nothing, and 50% of Americans could end up struggling in retirement.
Even if you live from paycheck to paycheck, there are ways to save up some money. And it starts with the right mindset.
Change Your Thinking
First of all, you need to believe there is plenty of money to go round for everyone. Anything that you want is abundantly available if you give it time and dedicate yourself properly. When you move from thinking that everything is scarce and hard to get by, to thinking everything is abundant and available, opportunities will present themselves.
In terms of saving, the key is to start small. In the beginning, start with $10 a week. Put it in an envelope, shoebox, safe, or the good old-fashioned cookie jar. Or an online savings account. That $10 a week will amount to over $500 a year.
When you feel comfortable, slowly increase that the money you want to save. Could you make it $15? Try $15 for a few weeks. Make it a habit to regularly put some money away every week.
Invest Your Money
Once you feel you have enough money saved up and you have a rainy-day fund to cover sudden expenses, you can look to invest some of your saved money.
If you have any debt, your number one priority should be to pay off that debt first. This is particularly the case if your interest rates are double digits. You won’t find an investment that can consistently perform better than the interest rates of your debt, so pay off your debt first.
But if you don’t have any debt, a great way to invest is in your employer’s retirement plan. Again, start small. Invest 1% of your salary, to begin with. Then slowly increase that percentage. The tax deduction will make your required contribution even smaller!
Otherwise, you could look to invest in US Treasury securities. Although they certainly won’t make you rich, it’s a great place to park your money and earn a bit of interest. Some US treasury securities are also protected against inflation.
And once you feel you’re ready, you can invest your money in stocks, bonds, collectibles, commodities, and more. They’re higher risk, but they produce a higher return too. Educate yourself and step into a world where instead of working for money, your money will be working for you.
