From little things, big things grow - so round-up your coffee purchase to the next $1 and invest the extra!
Micro-investing is when you take teeny tiny amounts of money (we’re talking one humble buckaroo) and invest it through apps.
It’s designed to get younger investors into the stock market - without the thousands-of-dollars minimum investment that some platforms require.
Micro-investing is all about the 1%-ers. This means it’s all about tiny investments that can add up in the long run.
Generally, you sign up to a micro-investing app, and link your bank account. Then, you can make regular deposits into the app or ‘round up’ your dollars.
For example, if you were to buy a large cap at a café for $4.50, a micro-investing app would round-up the purchase to $5, and invest that 50 cents! How cool is THAT.
The money you deposit or round-up will be invested in a pre-mixed investment fund, depending on your risk appetite.
If you’re cool with taking a few risks, you may choose a pre-mixed fund with a heavier allocation to shares. Or, if you care about the environment, you may be able to opt for an ethical fund.
Overall, micro-investing apps are just a convenient and simple way to start investing early, in pre-mixed funds - so you don’t need to do the leg work.
If you invest $2,000 in a trading platform, and it returns 7% annually, you’ll have made $140 on your investment. Not bad for a passive investment.
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