how to set up automated investments with spare change

Wiki Article

Ever feel like your spare change just vanishes without much to show for it? Believe it or not, those little bits of leftover money can be put to good use through automated investing. There’s even a popular way to start growing your savings with just the cost of a coffee each day — some people call it the "latteperday" method. It’s all about making small, regular contributions that grow over time.

So, how do you get started with automated investments using your spare change?

The good news is, it’s pretty simple — and you don’t need a lot of money to begin. First, look for apps that help you round up your purchases. These apps link to your bank account or debit card. Every time you buy something — say, you spend $4.30 on a sandwich — the app will round that purchase up to $5.00 and invest the extra $0.70. It’s a low-pressure way to ease into investing.

Once you’ve chosen an app or service (there are several out there), the setup usually takes just a few minutes. You’ll answer a few questions about your goals and how comfortable you are with risk. Based on your answers, your spare change will be invested in a mix of stocks and bonds — or other options that match your comfort level. You don’t need to be an expert, because the app does the hard work for you.

You might be surprised by how fast your savings can add up. Even if each round-up is only 50 cents or so, you could end up investing more than $20 a month without thinking about it much. Add in a little extra each month if you can, and you’ll see even more growth.

It’s also easy to check on your progress at any time. Most apps show you a simple breakdown of how much you’ve invested and how it’s performing.

Automated investing with spare change can be a stress-free way to build good habits. You don’t have to put big chunks of money aside all at once. Instead, your casual spending helps support your long-term goals — and that can feel pretty rewarding. So next time you grab a snack or a coffee, think of those few cents going toward your future self.