What you will learn: How small, consistent investments add up over time, what I bought with my $100/month, and the biggest mistake I made starting out.
From $0 to $2,800 in Two Years
I always thought investing required large amounts of money. I assumed you needed at least $5,000 to open a brokerage account and $500 per trade to make it worthwhile. I was wrong.
In January 2024, I started investing $100 per month using a simple index fund. Two years later, my total contributions were $2,400 and my account balance was $2,847. A return of $447, or roughly 18.6%. Not life-changing money, but proof that the system works.
What I Bought
I kept it simple: one low-cost S&P 500 index fund (VOO). No individual stocks, no crypto, no options trading. Just a boring index fund that tracks the overall market. The expense ratio is 0.03%, meaning I pay $3 per year for every $10,000 invested.
The beauty of index funds is that I don’t need to be smart. I don’t need to pick winning stocks or time the market. I just buy a tiny piece of the 500 largest companies in the US every month, month after month.
My Biggest Mistake
In month 8, I checked my account and saw I had lost money. The market had dropped about 8%. I panicked and stopped my automatic contributions for two months. During those two months, the market recovered and went up 6%. I missed the rebound because I was trying to time the market.
I learned the hard way: time in the market beats timing the market. I restarted my contributions and haven’t stopped since, regardless of what the market does.
The Habit Matters More Than the Amount
$100 a month feels small. But over 30 years, assuming 8% average returns, that $100/month grows to over $150,000. The amount isn’t what matters. The consistency is.
If you are waiting for the “right time” to start investing, stop. Start with whatever you can afford. $50 a month. $25 a month. The habit of investing regularly is worth more than the perfect investment strategy you never execute.