You can get started in mutual fund investing with relatively little money — a benefit when finances are tight, but you’re mentally ready to roll with an investment experience. When you buy shares of an individual stock, any purchase less than 100 shares is usually considered an odd lot, on which you must pay a high sales commission. But a bundle of 100 shares of stock isn’t easy for most investors to afford. If a stock is trading at (for example) $75 per share, 100 shares will cost $7,500 — a significant amount of money for most people.
By contrast, you can start investing in most mutual funds for just $1,000 to $2,000, and add to your investment later with even smaller amounts by sending a check to the fund company or arranging for automatic deductions from your checking account.) If you have only a small amount of money to invest but are eager to get started in mutual funds. This list, which is based on information provided by The Mutual Fund Education Alliance, gives you a sampling of fund companies and categories to consider when you’re looking to invest $500 or less. You can request information on specific funds by contacting any broker, the fund companies themselves, or The Mutual Fund Education Alliance (www.mfea.com).
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