Investment Ideas With the Lowest Buy-In

Getting enough capital to start out is an unexpected roadblock that deterred many people from becoming investors and realizing their dreams. For instance, when talking about the creation of passive income, the majority of people are pigeonholed into believing that the only way to do so is to buy a rental house/apartment.

Now, since they don’t have the money for this, they better just give up, right?

Well, not exactly. You see, there are a lot of ways to invest that don’t require a huge starting capital. With that in mind, what are some of these investment ideas that have the lowest buy-in? Let’s check it out!

1. Cryptocurrencies

The history of cryptocurrencies speaks for itself. Some people bought BTC at $12 each and sold at $17-60k. Is this likely to repeat itself? Well, probably not with BTC (not with those percentages and margins); however, there are some coins out there that are currently quite low-priced. This means that you could potentially make a huge profit with a small investment.

With cryptos, we’re talking about one of the youngest assets out there, where you still have a chance at early adoption. With more and more businesses adopting crypto, the total market value is bound to grow, which means that, when you spend your investments across several assets, you’re securing your portfolio for the future.

The biggest downside to investing in cryptocurrencies is the fact that there are so many of them that you’ll have a hard time figuring out where the investment money will be best spent. This is why it’s so crucial that you don’t just blindly invest but actually get familiar with the subject matter.

It’s also important that you find credible sources of information, regardless of whether we’re talking about the analysis or opinions; they’re as good as the sources they come from. Still, this is something that takes quite a while to establish.

2. Peer-to-peer lending

Aside from the obvious advantage of getting in direct contact with people who need money and being able to help them out, peer-to-peer lending offers a higher return than traditional saving would.

Another great thing about peer-to-peer lending is the fact that it’s a natural way to diversify your investments. First of all, you’re never giving your money to just one lender, and the chance of all of them failing to deliver is quite low. However, not a lot of people are just peer-to-peer lending; in fact, this is a pretty uncommon first-time investment. In other words, you’re probably just lending a part of your investment fund, not the entire bank, which means that it’s already a way to keep it diversified.

There are also not so many investment venues where you control where your money goes directly. With P2P lending, you actually have a way of giving money directly to those you want. You get to review borrower profiles and even go by your gut feeling if you feel like it.

Most importantly, this is one of the simplest ways to create a significant passive income. Sure, the next section on our list has a slightly lower buy-in, but it also has a lower monthly yield. With P2P lending, the interest that you collect will be significant.

3. Dividend stocks

There are not many ways to earn a passive income by investing so little. Other than creating an IP and living off royalties, there’s really no other way to create a passive income with such a low buy-in capital.

First of all, dividend stocks create a steady income stream for their investors. The dividends are paid regularly, usually off the profits made by the company, which means that it’s a sort of income that you can come to rely on. If you’re an income-oriented investor (which the majority of new investors are), it’s hard to argue for a better place to place your funds.

Another thing to understand is that the majority of companies don’t have stocks that pay dividends. This is why companies that do usually have a much higher performance and stability than their counterparts.

So, while all of this sounds great, what are the downsides? Well, first of all, the shares are probably going to be expensive. Sure, you can buy in, but you won’t be able to buy too much with a modest sum.

4. High-yield savings accounts

The most important thing to understand about these accounts is that they offer a modest return but present a very low risk for the investor. If you have enough money and are willing to wait long enough, this can actually generate quite a profit. Still, even if you don’t have that much money, you can always rely on the historical performance and stability of this investment method.

The compound returns can be quite substantive, but you have to develop the right mindset toward it. Just keep in mind that, for this to take place, you would have to wait for a while.

The best thing about these savings accounts is their high liquidity and accessibility. In most cases, you can withdraw funds from a savings account without significant obstacles.

Most importantly, there’s no market volatility. Just check if the interest rates are fixed and, if they’re variable, check what they’re depending on. In other words, they’re either stable or predictable, both of which can work pretty well in your favor.

5. Investing with robo advisors

When discussing the impact of AI on modern society, the majority of people are fixated on its creative capabilities. Therefore, they worry about the way AI will impact the music, film, and entertainment industry in general; however, they seldom pause to ponder the potential impact of AI on the financial world. Most specifically, on the way we invest.

For the majority of people, the biggest challenge lies in the fact that they have to invest that modest amount of capital that they’ve accumulated without any previous experience. How could you have any previous experience when you’re just looking for a buy-in?

Well, with the help of robo advisors, you’ll feel like you have a veteran financial advisor in your corner and you won’t have to pay for the fee of a financial advisor. The user interface is simple, there’s limited human interaction, and, you can always adjust if you feel like it.

With so many buy-in options available, the lack of sufficient capital is just an excuse not to invest

In other words, in a world where you can buy a fraction of a BTC, a single share, or put a minuscule amount of money into a savings account, you always have the option to invest. Sure, your profit will not be as high, but neither will your risk. Also, it’s better to start investing than to just postpone this indefinitely. The whole point of investing is to get your money to make you money.

This article does not necessarily reflect the opinions of the editors or management of EconoTimes