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Investing on a budget

Written by Nik Rainer | 5 minutes
FRI 06-09-2019
Building capital with a small amount of money seems like an impossible task. Let's start to clear up a misunderstanding. You don't have to be rich to invest smart. It is also possible with a small amount. In fact, it is perhaps the only way to make money grow substantially.

Smart investing is about investing
It is often smart to invest. But not everyone does it. Compare it with sports, studying, saving for a holiday or a healthier life. Only after a while after you get started does it start to look like you are getting somewhere. Rome wasn't built in a day. That's how it works with investing. Every bit helps. It grows into something unnoticed.

Proud of what you have achieved
Working on positive goals and seeing them come to fruition feels good. It's like exercising. For example, working towards a goal every month becomes a healthy investing. When it feels right it spurs you on to repeat it. That's how smart investing works.

Realize thought that you sometimes have to deal with setbacks, because the stock market is a rising and falling animal. There will be times when your stake has fallen in value. And that, of course, is disappointing. Investing has good and bad months or years. This is all part of it. So, do you have a small budget and do you want to work towards a financial goal or a beautiful dream? Well you can do it!

What five tips can we give to help a starter investor with a small budget?

5 tips for investing smarter and successfully with a small amount of  money

Start early: the earlier you start, the greater the chance of a good return
The sooner you start investing, the greater the chance that you will have money later. Starting a year earlier with setting money aside or investing is very smart. And this can already result in a considerably higher final amount. Albert Einstein - you know him from the theory of relativity - had a clear opinion about money and smart investing. By reinvesting interest (or dividend), you get an interest-on-interest effect. Einstein called this the eighth wonder of the world.

Ensure low costs and pay attention to small print

Low costs are very important for smart investing. Costs take a big bite out of returns, especially over the long term. For investors with a somewhat smaller budget, it is essential to pay attention to this. Because a percent less annual costs can save thousands of euros.

Spread as well as possible
Don't put all your eggs in one basket and don't bet on one horse. It can turn out well, but experience shows that it is smart to limit risks as much as possible. Nowadays there are many options for investing as smarter in diversified terms. For example with investment funds and index funds.

Invest smart and cautiously and be patient with your money
Investing is smart, but not a panacea. So don't expect to be rich tomorrow if you decide to invest today. Providers that suggest this should be taken with a pinch of salt. Furthermore, it is very important to invest only if you can miss your (monthly) investment.

Discipline - Invest monthly and step in smartly periodically
Make a healthy habit of smart investing. For example, get in every month with a small part of your income that you can afford to miss. It does not matter whether it is a small or large amount with which you invest. As long as you start. This way you will reach your goal a lot easier and almost unnoticed.

Do you want to start investing?

Do you have a limited budget (monthly) and want to invest? Call us now to open an account and speak to us about how you can invest smarter at BinckBank.

Investing involves risks. Your investment may be worth less.


Nik Rainer

Nik joined BinckBank in 2016 as part of the team responsible for rolling out the Saxo Bank international service. Nik has held positions at various banking institutions such as Hambros Merchant Bank, Standard Chartered Bank and Morgan Stanley and brings his solid financial background to the role. Working with the development of new client services and relationship management, Nik also contributes to local publications and forums.

The information in this article should not be interpreted as individual investment advice.  Although BinckBank compiles and maintains these pages from reliable sources, BinckBank cannot guarantee that the information is accurate, complete and up-to-date. Any information used from this article without prior verification or advice, is at your own risk.  We advise that you only invest in products that fit your knowledge and experience and do not invest in financial instruments where you do not understand the risks. 

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