How Much Money do you Need to Invest in Stocks?

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Did you know that for as little as , you can invest in the stock market? Now ten bucks isn’t going to get you very far on the road to financial independence – but at least it is a start.

We here at The Money Sprout believe that there are several steps necessary to eventually reach financial independence. First, you need to save as much of your income as possible, while still living life to the fullest. Spend money on the important things and get rid of unnecessary things – like cable television.

In addition to saving a ton of your income, it is important to increase your income at the same time. Whether it be creating new income streams or getting a raise at work – increasing your income is critical.

As you start saving more and hopefully earning more – the next and most important step is to put all that extra money to work. Make your money work to earn even more income. While there are a couple different options of how to put your money to work – I prefer investing in the stock market.

Whether you are saving more money and/or working to increase your income, it is never to early to start investing in the stock market. The good news is that it doesn’t take much to get started investing.

There should be no excuse for not having enough money to invest in stocks. No matter what stage you are at with working towards financial independence – start investing now!

We have listed several cost effective options below to help get you investing in the market – no matter how much money you have.

Invest $10 Using LOYAL3

Several of the companies that we own in our dividend stock portfolio are available to purchase through LOYAL3. Well known dividend paying companies like Microsoft (MSFT), McDonald’s (MCD), and WalMart (WMT) can be purchased through a LOYAL3 account, which requires a minimum purchase of $10.

Investing just $10 won’t get you a full share of those companies, but it will allow you to plant a seed that you can build from. The nice thing about LOYAL3 is that they allow their customers to buy partial shares of a stock – making it possible to own a piece of McDonald’s, WalMart, etc. with very little investment.

So a $10 initial investment in WalMart stock today would get you just over a tenth of a share based on the current $70 share price. That certainly is not a huge investment by any means. However, it is a start and hopefully you can build upon that investment.

An important item to point out is that LOYAL3 does not charge any commission on stock purchases. If it were not for this, a $10 purchase of stock would not be a smart investment decision since you would likely be paying a huge percentage of your investment on trading fee’s.

Buy 1 Share of Stock Using Robinhood

Another option for buying stock with little upfront investment is through Robinhood. Just like LOYAL3, Robinhood does not charge any fees for buying stocks. There is also no minimum investment amount through this broker but they do not allow partial share purchases.

The minimum investment amount to purchase stock through Robinhood is based on the current price of the shares you are planning to buy. So instead of investing $10 for partial shares of WalMart, you would need to invest $70 (or the current share price) for a whole share using Robinhood.

Robinhood also does not charge any fee’s or commissions for stock purchases, which helps investors stretch their investment dollars further. Also, unlike LOYAL3, investors can purchase any U.S. traded stock through Robinhood giving you many more options.

Direct Stock Purchase Plans

A third option for investing in stocks with little upfront capital is through a direct stock purchase plan (DSPP). Third party transfer agents like Computershare make it easy to start investing with very little money.

Transfer agents make it possible for investors like you and I to buy stock directly from a company, without a broker. We currently own shares of stock in 5 different companies through direct stock purchase plans – including Clorox (CLX), Cincinnati Financial (CINF), Lockeed Martin (LMT), Exxon Mobile (XOM), and Verizon (VZ).

The minimum investment amount depends on the company (normally $50 to $250) and is usually setup on a monthly investment plan through a DSPP. These monthly plans have allowed us to build up solid positions in many top notch dividend stocks.

For example, we have built up our position in Verizon (VZ) to 27+ shares of stock (at the time of this writing). By investing just $50 per month and reinvesting our dividends for the past 2 years, we have built a dividend income stream from shares of Verizon stock to over $60 a year.

On it’s own, $60 a year doesn’t seem like much but added into the rest of the portfolio it can really add up.

I would caution investors to make sure you check on the fees related to investing through DSPP’s as they can really add up if you are not careful. Every company is different and for those that charge fee’s, it may be better to invest through Robinhood or LOYAL3 in these cases.


The bottom line is that it doesn’t take a lot of money to invest in stocks. While you may not be able to purchase a bunch of shares, almost anyone can get started in the stock market for about $10! On top of that, investments can be commission free depending on the broker that you use.

One option is LOYAL3, where investors can start investing in stocks commission free for as little as $10. Zero cost commissions and partial share trades make this broker a smart option for investors with little capital to start.

While LOYAL3 may work for some investors, the list of available investment options (i.e. stocks) is limited. So if you are looking to purchase at least a single share (or more) of a U.S. traded stock, then Robinhood may be your answer. Robinhood does not offer partial shares but does offer all U.S. traded securities.

A third option for investors starting out would be investing through a direct stock purchase plan. They can come with some fees so be sure that you are not throwing a bunch of money away on your stock purchases.

Do you use any of the following ways to buy stock? Which option do you prefer?

Full Disclosure – At the time of this writing, we owned shares in the following stocks noted in this post – CINF, CLX, LMT, MCD, MSFT, VZ, XOM, and WMT. The material above is not a recommendation to buy. Please do your own research on a company before deciding to invest.

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