Starting an investment journey might feel overwhelming since many believe a large sum is required for initial investments. But in today’s investment world, investors can begin their journey with a small investment of just ₹100. The aim of starting with a small amount is to build wealth in the future and develop investment habits. In this blog, we will explore how a small amount of ₹100 can be invested to start an investment journey.
Why Start Investing Early, Even with Small Amounts?
The advantages of beginning online investing with small amounts are as below:
Power of Compounding
Even small initial deposits like ₹100 can multiply substantially due to compounding effects over time. The compounding process combines the interest earned on investment to the original investment which substantially grows the investment amount over years.
Discipline and Habit
Starting with small financial amounts helps investors build habits of saving and investing while learning the financial discipline that leads to long-term success.
Learning and Experience
A small initial investment allows investors to understand various investment methods, and investment practices without risking a significant amount of money. As they get comfortable with how different investments work, investors can scale up their contributions over time.
Accessibility
Today even small investors can start their investment journey because there are numerous financial products that offer entry points with just ₹100.
5 Smart Ways to Start Investing with ₹100
Several investment options allow starting the investment journey with small entry points even with ₹100. Some of these investment options are discussed below:
Mutual Funds (SIPs)
By investing through Systematic Investment Plans (SIPs) investors can start investing in mutual funds with small regular contributions of ₹100. SIPs are a great way to build a diverse investment portfolio with small initial investment.
Digital Gold
Today many investment platforms allow an investor to buy and sell digital gold for as little as ₹100. This way investors can invest in gold without the hassles of physical storage.
Exchange-traded funds (ETFs)
Exchange-traded funds (ETFs) are another great option to start investing with ₹100. ETFs are investment funds that track indices (like the Nifty 50 or Sensex) and are listed on stock exchanges, allowing an investor to buy and sell them just like individual stocks.
Stocks (Fractional Ownership)
Some platforms allow investors to buy fractional ownership of stocks which enables the investors to invest in even expensive stocks with minimal capital. This provides an easy first step to grasp stock market dynamics.
Stocks Priced Under ₹100
Another option is investing in stocks that trade under ₹100. These stocks often belong to smaller companies but can offer significant growth potential. They provide an affordable entry point into the stock market and investors can purchase more shares due to their lower price. Beginner investors who want to purchase stocks need to create a Demat account.
Steps to Start Investing with ₹100
Investors should follow the following steps to start their investment journey.
Choosing the Investment Avenue
Investors should evaluate their risk tolerance and financial goals before selecting the investment option and then choose the investment vehicles that suit their goals the best.
Automate the Investments
Investors should schedule automated payments of funds to their SIPs or recurring deposits through an automatic system to ensure consistent investing.
Stay Invested
Long-term investment success requires an investor to maintain their investment position. They should not panic during market fluctuations.
Review and Rebalance
Investors should periodically review their investments and portfolios. If needed they should rebalance their portfolio to ensure it aligns with their financial goals.
Conclusion
Investing is not just for the wealthy. By starting small and staying consistent, investors can build a solid financial foundation for their future. Today investors can start their investment journey, even with ₹100, and can take control of their financial destiny. Every small step counts and the power of compounding can work wonders over time. So, take that first step, explore the available options, and begin building your financial future.
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