Best thing to do with small amounts of cash

Hi all,

I have various low-level income sources that direct deposit into my brokerage account. So I get maybe $5 at a time. I was wondering if there was anything better to do with this money than just let it sit there until I have enough to buy a stock or fund that I want (normally between $60 and $150).

It is a Fidelity account so maybe there are some smaller no-fee iShares or similar funds I could consider that are cheap but not worthless? Then the money would still be working for me while I waited for it to grow?

I suspect I should just cultivate some self-control, but thought some of you might have a clever idea about how to invest small balances.

I would talk to Fidelity first, and see what they might have to offer and suggest within their offerings. If you have a storefront near you make an appointment and have a talk with a representative.

Mutual funds. Fidelity has a ton of mutual funds that you can buy into with less than $20 at no cost. My opinion, you should never buy stocks unless you are doing it with $1000 or more at a time, the commissions just make it nearly impossible to buy and sell and make money. In your case, I would ride a mutual fund until I had $2000 in it, then find a stock to buy... and then start over with your mutual fund until you once again have $2000.


Also, don´t underestimate the potential for mutual funds, especially if you go into one of the more targeted ones at the right time.

With these amounts we are definitely talking about something with no commission fees. Get in touch with your broker and ask to get a list of all the products they offer with no commission, then start making your research on those. But anything with a commission is a no go with such small amounts.

Money Market

www.phn.com/Default.aspx?tabid=665

I am not sure where the confusion is. Fidelity already offers a ton of no-load mutual funds that cost you nothing to put your money in and you can buy in with any amount.