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How to Get Started Investing With $1,000 or Less

Saving and investing have never been a strong suit for most Americans.

According to Bankrate, the average U.S. household has just over $8,800 set aside in savings, though that number is skewed due to the fact that older Americans have more on average ($17,000-plus) versus those 34 and younger, who have an average of about $4,700 saved up.

That’s just in liquid savings, though.

The median retirement savings by age in the U.S., according to the Transamerica Center for Retirement Studies, is: “Americans in their 20s: $16,000. Americans in their 30s: $45,000. Americans in their 40s: $63,000.”

Still, these numbers are far short of where they need to be for most people, given that the typical retirement is going to cost north of $800,000.

Building up Your Investment Account

Investing early and often is the best way to catch up with these needs, but too often people will hold off on taking the leap due to the fact that they don’t have much to invest at the start.

Investing with a small amount to start might seem like a disadvantage, but it can actually be a great way to learn about the investing process and tailor a strategy that fits your needs. Especially if you start small, think about your first $1,000 as the start of a long-term journey, not a one-off opportunity to multiply your money with the right pick.

Starting Small as an Investor

Investing with $1,000 or less is like buying your first pair of running shoes. When you purchase the shoes, you might have the goal of running a 5k, a marathon, or even an ultra in mind— a choice that’s entirely up to you. But, whatever your goal, know that those will not be the last pair of running shoes you buy.

Similarly, your first small sum investment should be your first step towards a comprehensive portfolio, not a one-time only investment.

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