5 Micro-Investing Platforms to Start Investing Small
Many people think investing is intimidating or simply out of their reach due to limited finances. But new technology has made investing more accessible, with some micro-investing platforms only requiring a few dollars to get started.
Here are some micro-investing platforms and apps that make investing more accessible to the general public.
What is micro-investing?
Micro-investing is an alternative means for investing small amounts of money without using a traditional bank or brokerage. It aims to remove common barriers to investing, like account minimums and per-transaction fees.
Micro-investing platforms
If you’re new to investing and want to explore fresh, up-and-coming opportunities, consider investing with a startup. Here are several micro-investing platforms that focus on supporting entrepreneurs and startup companies.
SeedInvest
SeedInvest provides an equity crowdfunding platform that allows anyone to invest in startup companies — something that used to only be accessible to venture capitalists and other elite investors. Since its inception in 2012, it has raised over $100 million for over 150 startups with a network of more than 250,000 investors.
Pros
You can directly support companies you’re passionate about.
They rigorously vet their startups and have only approved 1% of applicants.
The processing fee is refunded if the startup doesn’t meet its fundraising goal.
Cons
Startups are a high-risk opportunity, so your investment may not hold its value.
Requires a minimum investment of at least $500.
There is a 2% processing fee per investment.
Republic
Republic is another investing platform that leverages the power of crowdfunding to back startup companies and give them the funds needed to hopefully succeed.
Pros
You can start investing for as little as $10.
It’s free for investors, and there’s no hidden fees.
Cons
Investing in early-stage companies is highly speculative and may result in losing your investment.
Although they do their own due diligence, they don’t guarantee the accuracy of the that the stated valuation and other terms its startup partners provide.
AngelList
AngelList has over 2 million startup investment opportunities and has helped raise more than $1 billion of funding. This is a great option for anyone looking to specifically invest in tech startup companies.
Pros
Offers an interactive community platform that allows you to check progress and events of companies that are important to you.
Serves as a job board for openings with startup companies.
Cons
Only open to accredited investors who either had an income of $200,000 for the previous two years or $1 million in net assets.
Requires a $1,000 minimum to start investing.
Website isn’t user-friendly for individual investors looking to learn more about the process.
Micro-investing apps
Micro-investing apps make saving and investing easy and convenient. These apps work by connecting your credit or debit card and allowing the app to round up your purchases to the next dollar or make automatic transfers on your behalf.
Related: Investing for Millennials
It’s basically the digital equivalent of taking the leftover change from your purchases, putting it in a jar, and then investing your jar in stocks over time.
Acorns
Acorns offers investment and retirement savings opportunities in an easy-to-use app. Simply link your banking information, and the app will automatically round up each purchase. You can also earn extra money by shopping with their partner vendors. Acorns will make recommendations for your investment portfolio based on your financial situation and goals.
Pros
There’s no minimum to open an account, but you’ll need at least $5 of saved spare change to start investing.
Automated tools make saving and investing easy and hands-off.
Cons
If you maintain a low balance, the monthly fee of $1 to $3 may not be worth it compared to other similar apps.
There are limited investment options which may not make it ideal if you want to pick individual stocks and be more hands-on.
Stash Invest
The Stash Invest app can be used for investing, banking and saving. The Stash platform breaks down investments into fractional shares to make it more affordable. It has three tiers of pricing ranging from $1 to $9 per month.
Pros
You can begin investing with as little as $5.
You’ll get access to automatic saving tools that round up your spare change and provides savings analytics.
Cons
If you have a small portfolio, the monthly fee may be a significant percentage.
You won’t have the option to purchase individual stocks.
Is Micro-investing worth it?
Micro-investing is a great option for a novice investor who wants to get their feet wet before diving into the investment world. While it won’t make you rich, micro-investing can help you boost your income with a few hundred dollars a year.
Additionally, many micro-investing platforms have resources that can help you learn the basics of investing to give you more confidence when you’re ready to start making bigger investments.