Some beginners question whether investing for income is worth it when they have only a little money to start with.
Maybe they have a relatively small inheritance, insurance settlement, prize or other lump sum, of $25 to $5,000. They smart, and so they don't want to just spend it and see it vanish, but they're insecure about starting with that amount.
The Longer You Let Your Investments Compound, the Wealthier You Become
First of all, let's apply some common sense. The sooner you get started investing, the better off you are. That's because you'll receive more money from investing the longer you invest. Interest and stock dividends compound with time. The sooner you get started, the more time they have to compound.
Besides, you have to start where you are now now, with what you have.
The Best Place to Start is With a DRIP
My suggestion is to get into a DRIP -- a Dividend ReInvestment Program.
That's where you buy stock shares directly from the company. They don't charge commissions, and they'll automatically reinvest your dividends into more shares.
That way, your portfolio will keep growing.
Yes, it will be slow at first. If you start with $25, don't expect your first million any time. It's obviously not a get rich quick program, but nothing is, and it's a good deal for small investors.
Remember that the returns do compound. When the DRIP program reinvests your dividends into buying more shares, those new shares will -- in turn -- generate dividends. So next quarter you'll receive a higher amount of dividends. They will buy even more stock shares, and so on . . .
If you keep reinvesting dividends for years, sooner or later you'll have lots of money to invest with!
Many Large Companies Have DRIP accounts to Encourage You to Buy Their Stock
I suggest you open up a DRIP account with a major company. Many companies that are older, well-established and paying dividends will let you open up an account directly with them. There may be some small cost, but not as much as you'd pay a broker.
Once you set it up, either add to it or forget about it until you retire. You'll be pleasantly surprised at much your money has grown to by then.
This page has a long list of companies offering such plans --
wall-street.com/directlist.html
I can't say for sure that American companies won't accept Canadians into their DRIPs, though I don't see why that should be a problem. If it is, just go to this page for more info on Canadian DRIPs --
cdndrips.blogspot.com/
DRIPs are Far More Cost-Effective Than Mutual Funds
I recommend you open a DRIP account at a major, dividend-paying company even if your lump sum is the $2,000 or $3,000 minimum most mutual funds require to open an account. Mutual funds have lots of expenses you won't find with DRIP accounts. Also, although some mutual funds focus on the kinds of companies that pay dividends, that's not their investment criteria.
Therefore, DRIP accounts at large dividend-paying companies are a terrific deal for people with relatively small amounts of money for investing for income.
Author Information: You too can benefit from investing for income with DRIP accounts. Click here to get the information you need to effectively make money from your investments whether the markets go up or down. If you're ready to discover how investing for income can help you retire with financial security, visit this page, enter your email address into the form and click on the Submit Button. Then go to your inbox and verify that. It's free for the taking. http://www.incomeinvesthome.com/. hostgator promo codes
![[Valid RSS feed]](http://societyandculture.org/images/icon_Rss.png "XML Feed For RSS"){kind=icon}
Category Rss Feed
Print This Article
Add To Favorites 
![[Valid RSS feed]](http://societyandculture.org/images/rss.jpg "XML Feed For RSS")