What Is Micro Investing?

Investing once required large sums of money, hefty fees, and a broker to manage everything. Now, with micro investing, you no longer need wealth to build wealth. This new approach means anyone can invest and grow their money. 

With micro investing, you can invest small amounts of money in accounts with low fees and low or no minimum deposit and balance requirements. Since investment accounts are designed to pay more interest than traditional savings accounts, it’s a great way to make your money work harder for you while you learn the basics of investing. 

When Did People Start Micro Investing?

Micro investing is a fairly recent concept that makes investing easier and cheaper. High minimum deposit amounts, hefty fees, and the assumed complexity surrounding traditional investing used to keep many people from taking advantage of the benefits of investing. 

But in just the last decade, companies have begun to offer more accessible investment accounts with low minimums and fees and personalized management. You can even manage these accounts with a convenient app, and you can find fully managed investment accounts that do the work for you.  

Does Micro Investing Really Pay Off?

According to the FDIC, the standard interest rate on a savings account is .09%  ̶  just one cent on every ten dollars. Most moderately conservative investment accounts can generate more than that. Micro investing helps your money work harder for you. 

Many platforms offer investment education resources, so micro investing can help you learn more about handling and growing your investments. Having your portfolio at your fingertips, accessible via an app on your phone, will help make saving, investing and tracking your portfolio a habit. 

Micro investing alone probably won’t fund your retirement. But it will get you started in investing, help you make more in interest than a traditional savings account, and get better at managing your money. Micro investing can be one of the first steps towards a long-term financial strategy. 

How Much Money Do You Need To Get Started?

One of the biggest benefits of micro investing is that you can get started with as little as a dollar. Of course, the more you invest, the more you could make. 

Most micro investment platforms use these small investment deposits to buy shares – or fractional shares – of exchange-traded funds or ETFs. An ETF is a group of stocks, bonds, or commodities, or some combination of these, that you can buy and sell. ETFs are as diversified as mutual funds, but can be traded as easily as stocks. ETFs offer a range of investments in a single fund tied to a risk profile. 

Your risk profile is your investing comfort zone. How do you feel about the possibility that your investment could lose value? And how willing are you to take a risk for a greater return? Typically, more conservative investments are least likely to lose value but will earn lower interest. More aggressive investments typically have the highest risk of loss but also the best likelihood of higher returns. 

While fees are generally low, there are fees associated with most micro investment accounts, and they can increase as your account grows. Review the platform carefully to make sure your fees are not seriously impacting your investment gains. 

Take a close look at your budget and spending habits. Consider what you may be able to put aside for investing. And consider your goals. Are you saving for a down payment on a car? A vacation? A special event? Micro investing can help you get there. 

Where Can I Open a Micro Investing Account? 

MoneyLion offers a fully managed account that can help you kick off your micro investing adventure. We charge no management or trading fees, and there are no account minimums.

The vast majority of MoneyLion members – over 90% – are first-time investors. So we’re in a great position to help you get started. 

The platform offers a personalized, managed portfolio

Tell us about your risk tolerance and your investment goals, and we’ll select the right portfolio and funds for you. We offer ETF funds with risk profiles ranging from the highly conservative SteadyIncome portfolio to a very aggressive equity-only portfolio. 

With a MoneyLion investment account, you can easily view your portfolio at any time in the MoneyLion app. You can use the app’s Risk Slider to see how being more or less aggressive could change your portfolio allocation. Then you can make changes easily in the app – all without management fees. You can add money, in any amount, at any time, and we put it to work for you immediately.

Make investing even easier by setting up an Auto Investing, which transfers an amount of your choosing from your checking account to your MoneyLion investment account on your schedule. 

When Should I Start Investing? 

One of the hardest things about investing can be just getting started. But the sooner you start investing and the more you can direct to your account, the closer you’ll be to your goals.

MoneyLion makes it easy with a fully managed account with zero management or trading fees, and you can get set up within minutes. Investing has never been easier!

The first step toward achieving your investing goals is to download the MoneyLion app. Set up your account. Consider your budget and your goals and decide how much you can invest.