Turn Spare Change into Savings: The Power of Micro-investing

Do you want to start investing but don’t have a lot of money to spare? Micro-investing could be the perfect solution for you. Micro-investing involves putting small sums of money, such as your spare change, into investments. There are various apps that can help you do this. Here’s what you need to know about micro-investing and how to get started.

Why micro-invest?

Micro-investing is an excellent option for people who don’t have a large sum of money to invest. It allows you to start investing early, even if you can only afford to invest a small amount. It also makes investing a habit since it’s automated, and the amounts are usually small enough that you won’t even notice the money is gone. Additionally, micro-investing is a great way to take advantage of compound interest, which is the process by which your investment gains are reinvested and earn even more returns.

Who should micro-invest?

Everyone who can afford it should micro-invest. You only need to be able to spare around $5 plus any applicable fees to get started. If you don’t have that much to spare, don’t worry. Some apps like Drop allow you to ‘invest’ your reward points into cryptocurrencies. Just make sure you can keep your money in your investments as long as possible to take advantage of low purchase prices and long-term gains.

When should you micro-invest?

The ideal time to start micro-investing is as early and as often as you can. Even during an economic downturn, like a recession, you want to invest. It’s during a recession that stocks tend to be cheaper, giving you an opportunity to buy low and sell high later. However, it’s essential to have a low-risk profile and leave the money invested as long as possible to maximize the potential for growth.

How to Micro-invest Using Apps

Moka is a micro-investing app that rounds up your transactions to the nearest dollar and invests the amounts on your behalf. The app connects to your bank account and withdraws money weekly to invest. You can create various accounts to invest in, such as TFSAs and RRSPs. Moka makes it easy to start investing and forget about it.

It’s the micro-investing app that I use so I know and have the most experience with it. Personally, I like it a lot. I love being able to log in after every month or so and seeing how much I have been able to save.

Drop , on the other hand, is a reward app that allows you to earn points by shopping at certain stores, playing games, and completing surveys. You can also connect your bank account to earn even more points. Once you earn enough, you can invest your points in cryptocurrencies like Ethereum or Bitcoin. You can redeem your points for gift cards or convert them back to cash when you want to withdraw. This app is an excellent option for those who want to invest using rewards without using their bank account.

Crypto-currencies generally aren’t the safest investment but with Drop, you are investing reward points and not your own money. So it’s money you wouldn’t have had anyways or you can just use your points to buy gift cards.

In conclusion

Micro-investing is an excellent way to start investing with small amounts of money. It’s never too early to start investing, and micro-investing apps make it easy and effortless. Whether you use Moka or Drop, you can start investing today with just a few dollars. Remember to start small, invest regularly, and let time and compound interest work their magic. Happy investing!