Many people believe that investing exists as a way for people who are already rich to get even richer. If you don’t have much money to start with, it’s difficult to impossible to become an investor. Nothing could be further from the truth.

Consider Warren Buffett, the most famed and probably greatest investor of all time. When you picture him, you picture what he is now — a billionaire, constantly appearing on lists of the world’s richest people. But when Buffett got his start in investing, he was anything but rich. He was a kid, barely into puberty, from a middle-class household at best. He started investing by reading every book he could find on the subject as a preteen. Then he worked odd jobs and bought stocks with the money he made.

If 12-year-old Warren Buffett, growing up in a working-class Omaha neighborhood, can find a few dollars to start investing, so can you. Here are two easy ways to start investing today, even if you’ve never done it before and aren’t rich:

Use a “Round Up” App

A “round up” app, such as Acorns, connects to your debit or credit card and rounds up every purchase you make to the next dollar. It then takes the extra change and invests it in a combination of stocks and bonds. If you buy a smoothie at the smoothie shop for $4.29, your card gets debited for $5. The extra 71 cents go into your investment portfolio. From that moment forward, it earns compound interest.

When you set up your account, you can customize the makeup of your portfolio. If you aren’t familiar with the different types of investment products, the app will walk you through it, helping you build your portfolio based on how conservative or aggressive you want to be. If you are a true beginner to investing, there is no faster or easier way to get started. Best of all, you don’t even need to have money set aside to start your portfolio.

Try a Robo-Advisor

A financial advisor is someone who manages your investment portfolio for you. Based on your stated goals, they buy and sell securities on your behalf, trying to maximize gains based on changing market conditions. 
The upside to a financial advisor is that they tend to know much more about investing than the average person. They also keep much closer tabs on the market.

The downside, however, is that they don’t work for free. Most advisors work on either a fee or a commission-based schedule. Fee-based advisors charge a specific amount, usually a flat percentage of the value of your portfolio. Commission-based advisors get paid based on the financial products they sell you. You have to be careful with commission-based advisors, as they might have financial incentives to sell you products that aren’t the best fit.

A robo-advisor does all the same things as a traditional advisor. It manages your portfolio. It buys and sells stocks and other assets on your behalf based on market movements. It takes your goals and objectives and structures your portfolio accordingly. The difference? A robo-advisor isn’t a human being. It’s a piece of software. Its decisions are based on finely tuned calculations and algorithms developed using years of market data.

And robo-advisors are much cheaper than traditional advisors. Two of the most popular ones, Betterment and Wealthfront, have options allowing beginner investors to get started for free.

For more great financial tips, contact JMV Financial Services today!