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How Much Money Should a Beginner Invest?

Guest Post | Nov 18, 2022

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It is often difficult to start investing because of the pressure and uncertainty. Beginner investors are reluctant to begin investing before they accumulate the right amount of capital to start with. However, deciding which amount of cash is enough to make the first investment is another issue. Some people think that you need a few hundred or even thousands of euros to be eligible to invest. In reality, you can start investing and testing the water with just a few euros.

The Perfect Amount to Start Investing

While some articles claim that you need at least 500 euros to begin investing, the real answer is not as clear. In reality, the perfect amount of money for investing is different for each person. The number can change based on your income, time limits, the ultimate goal for saving, etc. To settle the amount of cash you want to invest regularly, go through these few steps first:

  • Deal with your debts – it might be tempting to invest money and expect some revenue from it while you are still in some kind of debt. However, debts usually have higher interest rates than you can receive from investments as a beginner. After paying off the debts, you will be able to invest more confidently and expect great income over time.
  • Plan your budget – carefully planning your budget is essential to feel secure with your income and have enough cash to put aside for investing. See how much you earn and how much you spend each month. List your expenses and see which ones are essential, such as your bills, medications, etc., and which ones are for entertainment. This way, you will be able to see if you have spare money to invest regularly.
  • Plan for emergency expenses – emergencies always happen when we least expect them. You have to consider some unforeseen expenses when you invest money. If you invest in certain plans that do not allow withdrawing money before the necessary time passes or there are fines if you do so, you will need to spare some money to put into a saving account as well. If your investments can be easily retrievable when you need the money urgently, this works too.

Ultimately, this comes down to how much money you specifically can spare for making an investment. Managing your finances properly will help to put aside a fixed amount of money regularly and gradually increase it to meet all your goals.

Investment Solutions

While it is possible to find investment options for every budget, some solutions are more fitting for beginners than others. If you are interested in where to invest money online, here are some routes you can take as a beginner investor:

  • Investment funds – this is a great solution for beginners as it is less risky than investing in stocks or other assets right away. One of the alternative investment services in this category is Quanloop. There, you can invest any amount based on your capital and withdraw it every 24 hours if you need to. In addition, you can try investing just one euro to test things out. This is the lowest investment you can find.
  • Stocks represent ownership of a part of the company you buy them from. The prices for stocks can differ tremendously. To invest in shares efficiently, you should do thorough research on a business to see whether there is a potential for this company to succeed. If the business goes bankrupt, its shares lose their value.
  • Cryptocurrencies – this solution is not for everyone, but a popular option to invest money online today is crypto. Digital currencies are considered a good investment by many, especially if you are interested in technology and blockchain. With virtual currencies, it is also possible to invest in various tokens to have a diverse portfolio and purchase cheaper cryptocurrencies at first.

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When you decide on a specific amount of money, online investment options will be more clear. As a beginner with a lower budget, you can try solutions that allow small investments and convenient withdrawals, like investment funds. The risks are still involved, but with convenient risk plans, you can adjust your strategy based on your budget and the sum you are willing to invest.


NCFA Jan 2018 resize - How Much Money Should a Beginner Invest?The National Crowdfunding & Fintech Association (NCFA Canada) is a financial innovation ecosystem that provides education, market intelligence, industry stewardship, networking and funding opportunities and services to thousands of community members and works closely with industry, government, partners and affiliates to create a vibrant and innovative fintech and funding industry in Canada. Decentralized and distributed, NCFA is engaged with global stakeholders and helps incubate projects and investment in fintech, alternative finance, crowdfunding, peer-to-peer finance, payments, digital assets and tokens, blockchain, cryptocurrency, regtech, and insurtech sectors. Join Canada's Fintech & Funding Community today FREE! Or become a contributing member and get perks. For more information, please visit: www.ncfacanada.org

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