How to Invest on a Tight Budget

9 Ways to Invest on a Small Budget

Investing is crucial for long-term financial health. It helps build wealth, diversify income, secure retirement, and provide a nest egg for your family. However, many people delay investing or believe they can’t afford it.

I’ll admit, investing wasn’t my top priority when I was struggling financially. Even after landing a decent-paying job, I focused on paying off debt, which isn’t necessarily a bad thing. However, starting to invest early allows your money to grow through compound interest. I now advocate for investing while paying off debt, even on a limited budget.

Think you can’t afford to invest? Here are a few ways to find money to invest, even on a low budget.


A common misconception about investing is that you need a lot of money to get started. In reality, you don’t. The thought of investing a significant amount and potentially losing it can be daunting, but you can start small.

I began investing with only $100. Many investors favor index funds for their diversity and low fees, which help maximize returns. ETFs (Exchange Traded Funds) are also great for beginners because they provide diversity and are easy to buy and sell.

Betterment is an excellent option for beginners, allowing you to create investment goals and manage your funds in ETFs based on your portfolio allocation.

If anything, start by investing in your retirement. If your employer offers a 401(k), even small contributions can make a difference. You can also open an IRA (Individual Retirement Account) and contribute whatever you can, even if it’s not the maximum amount.


Once you realize you can start investing with small amounts, you can find more money by cutting excess expenses from your budget. Regularly review your budget line-by-line to identify any expenses you can reduce or eliminate.

Prioritize investing over non-essential expenses like dining out, shopping, and cable TV. You don’t have to cut these out entirely, but reducing them can free up more money for investing. Also, shop around for better deals on services you feel you’re overpaying for.


If your budget is already tight, consider finding a better-paying job to allow you to invest more. This may involve asking for a raise or seeking other opportunities in your field. Increasing your income can help meet your needs and financial goals, making it easier to invest.


Another way to increase your income is by getting a side hustle. Identify your skills and interests to find a suitable side job. Options include freelancing, babysitting, dog walking, lawn mowing, or taking online surveys.

Freelance writing, for example, is flexible and can be lucrative. It only took me a few months to start earning $1,000+ per month from freelancing, which can significantly boost your investment funds.


Selling unwanted items is another way to earn extra money for investing. You can sell items like jewelry, clothing, shoes, bags, books, toys, and movies online or at resale shops.

Take inventory of your belongings and note items you no longer use. Selling these items can declutter your home and provide additional funds for investing.


There are many good reasons to start investing today. Two key reasons are keeping up with inflation and allowing your money to grow exponentially. If you struggle to find money to invest, try a combination of the strategies mentioned above.

Remember, you can’t afford not to start investing – not the other way around.

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