I Have $17.76 in My Bank Account. Is That Enough to Start Investing?

Independence Day is nearly upon us, so prepare for firework-singed eyebrows and barbecue-sauce-stained t-shirts. And what better way to celebrate than to start investing?

Even if all you have is, say, a patriotic-but-paltry $17.76 in your bank account, you can still get started.

Investing with $17.76?

Yes, having less than $20 is scary. And there are several things you should probably do before you even think about investing. For starters:

• Start budgeting. Immediately.
• Get an emergency fund together; It’s recommended that it covers at least a few months’ worth of expenses.
• Pay down your high-interest debt. Mortgages and student loans can wait, but you’ll want to target those credit card balances ASAP.

What if you’ve already have got these covered? Consider investing! And yes, there are ways to do it.

Investing with your pocket change

While you’re probably not going to be able to go to a traditional brokerage company and open an account with only a few bucks, you can invest that money using a service like Stash. Stash, for example, requires only $5 to get started.

Some companies require a minimum balance to open a brokerage account, often thousands of dollars. If you don’t have a couple grand lying around, you’re effectively priced-out.

Stash is different. We allow you to invest small amounts of money, which over time could set you on the path toward financial independence.

Make it a habit.

If you do start investing with a small initial amount, you can’t realistically expect to see a big return. Even if you were to earn a 30% return on your portfolio with $17.76 invested, you’d only have $23.08 after a year.

A 30% return is astronomical, and not a realistic return for the average investor. And even if you were to beat the S&P 500—which has historically returned around 10% per year—you still wouldn’t be creating much wealth with only your initial $17.76 invested.

Going forward, market returns are likely to be closer to 5%. But even with a small initial investment, you can take advantage of something called compounding. That’s when the interest on your initial savings amount also earns interest.

Try to make saving and investing a habit, so you’re adding to your portfolio and growing your wealth over time.

$17.76 is a start, just as the year 1776 was a start for America’s Founding Fathers. But it takes determination and discipline to build wealth—just as it does to build a nation.