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How to Start Investing with $500

Investing can be a great way to grow your money, but it can feel daunting to get started – especially if you don’t have a lot of money to invest, shares Brian Colombana.

If you’ve got $500 to start with, don’t worry – there are plenty of options available to you.

In this article, we’ll take a look at some of the best ways to invest $500.

1. Open a High-Yield Savings Account

Brian Colombana says if you’re looking for a safe place to park your cash, a high-yield savings account is a good option. These accounts offer higher interest rates than traditional savings accounts, so you’ll earn more on your money.

There are a few things to keep in mind when you’re looking for a high-yield savings account:

  • Look for an account with no monthly fees.
  • Compare interest rates. Some accounts offer higher rates than others.
  • Consider whether you need easy access to your money. Some accounts have withdrawal restrictions or penalties.

2. Invest in ETFs

Exchange-traded funds (ETFs) are a popular way to invest, and they’re a great option if you’ve got $500 to start with. ETFs trade on the stock market, and they offer exposure to a wide range of assets, including stocks, bonds, and commodities.

One of the biggest benefits of ETFs is that they’re low-cost – which means you can get started with a small investment. And, because they’re traded on the stock market, you can buy and sell them easily.

3. Buy Individual Stocks

If you’ve got $500 to invest, you could also consider buying individual stocks. This offers you the opportunity to pick and choose the companies you want to invest in.

However, it’s important to remember that individual stocks are riskier than other investments like ETFs or mutual funds. So, if you decide to go this route, make sure you do your research and only invest in companies that you believe in.

4. Start a CD Ladder

Brian Colombana suggests a CD ladder is a great option if you’re looking for a safe investment with decent returns. With a CD ladder, you split your money into several CDs with different maturity dates.

For example, let’s say you had $500 to invest. You could put $100 into five different CDs, each with a different maturity date. When each CD matures, you can choose to cash it in or reinvest the money.

CDs are a low-risk investment, and they offer higher interest rates than savings accounts. However, they do have some drawbacks – chief among them is that you may not be able to access your money early without paying a penalty.

5. Invest in Real Estate

Investing in real estate can be a great way to grow your money, but it’s not for everyone. If you’ve got $500 to invest, there are a few options available to you.

One option is to invest in a Real Estate Investment Trust (REIT). REITs are company that owns or finances income-producing real estate. They’re traded on the stock market, and they offer investors a way to diversify their portfolios with a relatively small investment.

Another option is to crowd fund a real estate project. This is a relatively new way to invest in real estate, and it allows you to pool your money with other investors to finance a project.

Crowdfunding real estate projects are a risky investment, so make sure you does your research before you put any money into it.

6. Use Robo-Advisors

If you’re not sure where to start or you don’t have the time to manage your investments, Robo-advisors can be a good option. Robo-advisors are online services that offer automated investment management.

They use algorithms to create and manage portfolios for their clients. And, they’re a great option for hands-off investors who want to invest without having to do all the work themselves.


Brian Colombana concludes there are a lot of different options available to you if you’ve got $500 to invest. The best option for you will depend on your investment goals and your tolerance for risk.

If you’re looking for a safe investment with decent returns, a CD ladder or Robo-advisor could be a good option. If you’re willing to take on more risk in exchange for the chance to earn higher returns, you could invest in individual stocks or real estate.

No matter what you decide to do, make sure you do your research before investing any money. And, remember that all investments come with some risk. So, don’t invest more than you can afford to lose.