{"id":7188,"date":"2013-11-27T06:15:13","date_gmt":"2013-11-27T14:15:13","guid":{"rendered":"http:\/\/www.marketriders.com\/investing\/?p=7188"},"modified":"2016-12-21T07:28:17","modified_gmt":"2016-12-21T15:28:17","slug":"how-to-invest-1000-right-now","status":"publish","type":"post","link":"https:\/\/www.marketriders.com\/investing\/how-to-invest-1000-right-now\/","title":{"rendered":"How To Invest $1,000 Right Now"},"content":{"rendered":"

Getting started investing<\/a>\u00a0is tough. Many investment accounts have minimums that keep small investors at arm\u2019s reach, for instance.<\/p>\n

Buying stock<\/a>\u00a0with limited resources can be difficult as well. You might end up with five or 10 shares of two or three firms at most. Commissions are low but they add up to a high percentage of your money when amounts invested are limited.<\/p>\n

\"how<\/a><\/p>\n

But a larger question remains: Should a small investor even be in the market? If you have saved up $1,000 and want to invest in something, somehow, here\u2019s a few issues to consider first:<\/p>\n

1. Sock it away in a savings account<\/strong><\/p>\n

Do you have enough cash in the bank to cover the deductible in the case of a car accident or health emergency? Enough to cover an unexpected home repair? The simple fact of the matter is that most small investors fail not because they don\u2019t know what to buy but because they aren\u2019t ready to absorb a short-term financial hit.<\/p>\n

Do this simple exercise: Add up your current monthly expenses and multiply by six. If you don\u2019t have that much money in the bank in a standard savings account, get to that point before you consider\u00a0investing in the markets<\/a>. You\u2019ll be calmer and happier for it, and probably a calmer and happier investor.<\/p>\n

2. Pay down debts first<\/strong><\/p>\n

Money\u00a0compounds<\/a>\u00a0both for and against you. When you have consumer debt, especially credit cards, you are paying a much higher rate of interest on those loans than you will make in the market.<\/p>\n

Pay off all short-term debts before investing. It\u2019s important to invest early and consistently, but not if you owe significant amounts at high rates of interest. If you have $1,000 to invest in something, the most important \u201creturn\u201d on your money today could be eliminating extended debt payments.<\/p>\n

3. Consider a balanced index fund<\/strong><\/p>\n

Cash cushion in place and debts paid off, now it\u2019s really time to invest. If you have $1,000, open and fund an IRA at your bank or online at a brokerage.<\/p>\n

The least expensive and most effective way to invest a small amount is to buy a\u00a0balanced index fund<\/a>, such as a\u00a0Vanguard LifeStrategy fund<\/a>. Once you have the balance up to $25,000 or so, consider buying a\u00a0portfolio of inexpensive\u00a0ETFs<\/a>\u00a0and rebalancing that portfolio prudently over time.<\/p>\n

Saving, investing and living debt-free go hand-in-hand. All three matter to your long-term financial health.<\/p>\n","protected":false},"excerpt":{"rendered":"

Getting started investing\u00a0is tough. Many investment accounts have minimums that keep small investors at arm\u2019s reach, for instance. Buying stock\u00a0with limited resources can be difficult as well. You might end … Read more →<\/span><\/a><\/p>\n","protected":false},"author":8,"featured_media":7189,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_wp_rev_ctl_limit":""},"categories":[8],"tags":[62,42,43],"yoast_head":"\nHow To Invest $1,000 Right Now | MarketRiders<\/title>\n<meta name=\"description\" content=\"Should a small investor even be in the market? 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