5 Ways to Start Investing with Little Money

Investment opportunities are rife for the picking today thanks to technology. Those who would have been unable to buy stocks years ago due to the financial requirements are now able to begin learning how to invest and turn their small budgets into greater profits. But it still takes some start-up capital to begin your investing career. 

Even if you plan on keeping your day job, you have to start thinking of yourself as an investor if you want to succeed. You can't just be someone who is investing here and there and hope to get rich without any effort. It takes hard work, education and a willingness to lose money before you earn any to truly become successful. Below are five options you might like to try if you're looking to start investing with little money.

Banks that offer savings accounts with interest allow you to generate cash just by putting yours away. Most banks do have a minimum monthly balance requirement or a minimum deposit requirement. For example, Chase Bank requires a $1500 minimum balance or an automated $25 a month deposit from your checking account. The most important thing to consider when opening your savings account for investment purposes is the APY or annual percentage yield.

The APY is how much of your money you earn over the course of a year. The higher your balance, the more money you generate. This can be a good starting point for someone who really doesn't have money to lose and would prefer to keep all their initial capital for later use. You won't wind up with a massive, multi-thousand-dollar payout like you can with traditional investing, but this is a safe and stable way to increase your finances.

The stock market used to be off-limits for someone without hundreds of dollars to spare, but that is no longer the case. You can learn how to invest in penny stocks with free guides online. Nowadays, with $0 trading commissions, you can put just a few dollars into a major stock like Google instead of buying an entire share. Penny stocks are also available for a number of businesses that can help you get the hang of basic investing without wagering your entire savings.

What if you owned a property with others instead of having to buy an entire house and sell it yourself? That's the logic behind real estate crowdfunding. Rather than having to get approved for a mortgage and close a deal on your own, you become a partial owner and split the profits after a sale with the others. Of course, there's a lot more to it than just tossing some money into a property and getting rich. Check out this guide to learn about building a portfolio with crowdfunding real estate.

If you sign up for life insurance with a cash value, you will earn money just by paying your premium. The premiums are more expensive for these types of plans, but they are fixed and give you a guaranteed amount of money to take out and spend however you want later in life. You generally have to keep the policy for a certain amount of time before you can sell it or withdraw the cash value; you can, however, borrow from your life insurance as well. For someone who wants the added benefit of protecting their loved ones, life insurance is a good way to begin investing wisely.

If you are not already using your employer-sponsored retirement account, you may want to start. You can grow your 401(k) little by little each year, starting off with small amounts that you gradually increase over time to earn more. To borrow early, you will have to pay a penalty, so this is a form of long-term investing that's best suited for those who are looking to build up financial security rather than replace their income.