How to Invest $100

The most important step in investing is simply getting started. And this is true regardless of how large or small your initial investment dollars are. In this article, you'll learn six great ways to invest with just $100 -- or even less. By putting your money to work, you'll be well on your way toward long-term financial independence.

Six great ways to invest $100 starting today

You have $100 and are looking to invest it. Here are our six best suggestions for how to do that:

1. Start an emergency fund.
2. Use a micro-investing app or robo-advisor.
3. Invest in a stock index mutual fund or exchange-traded fund (ETF).
4. Buy fractional shares of stocks.
5. Put it in your 401(k).
6. Open an individual retirement account (IRA).

Now, let's take a look at each of these in more detail.

1. Start an emergency fund

You might be thinking, "This isn't an investment." And you're right. But what if you buy stocks with your $100 and then need to buy a new tire for your car soon after? You'll have to sell the investments you just bought. That's why starting with money in a savings account -- even if it's a small amount -- is a crucial part of investing.

If you already have money in savings to cover life's unexpected expenses, you can skip this idea. But if you don't, using $100 to start an emergency fund can be the smartest personal finance move you can make.

Interest rates on savings accounts have also improved greatly in the past few years. As of late 2025, you can easily generate 3% returns or more from your emergency savings.

2. Use a robo-advisor

Once you have financial emergencies covered, you're in a much better position to start investing. But what if analyzing stocks and other investments sounds a little too much? In this case, a robo-advisor may be just the ticket.

Robo-advisors ask a few questions about your financial goals and life circumstances, and then develop a customized investing strategy. They'll use basic information, such as age, family size, income, and risk tolerance. Robo-advisors then handle all the details of selecting investments, making purchases and sales, and keeping you informed.

6. Open an IRA

Have an extra $100 you want to invest for retirement above and beyond your company 401(k)? An individual retirement account (IRA) is a great way to go, and it can turn even small sums of money into a substantial nest egg over time.

Let's say you stash $100 a month in an IRA for 30 years. Based on the S&P 500's historical performance, the $36,000 you invest would be worth almost $180,000. That's the power of compounding gains over time.

Why an IRA? In a word, taxes. With a traditional IRA, you gain similar benefits as with a 401(k), reducing income taxes by cutting your taxable income each year you contribute while also growing your nest egg tax-free until you start taking distributions in retirement.

A Roth IRA gives you the same tax-free growth as a traditional IRA. However, instead of lowering your taxable income each year by making contributions, distributions in retirement are 100% tax-free.

Is investing $100 worth it?

It may not seem like investing $100 will have a meaningful impact on your financial future. But over the long term, the act of getting started can lead to financial behaviors that can make a big difference. Investing $100 one time might not create life-changing wealth. But investing $100 every month certainly can.

One way not to invest $100

One trap to be aware of is investing in penny stocks. Penny stocks are typically low-priced stocks of smaller or thinly traded companies.

While it may seem logical that tiny companies or stocks trading for just pennies per share (or even less) have the highest return potential, the reality is that the world of penny stocks is full of fraudulent companies and pump-and-dump schemes (think The Wolf of Wall Street). In short, if you're asking how best to invest $100 in penny stocks, the answer is, "Don't."

Tips to maximize your $100 investment

If you're investing $100, the absolute best way to maximize your investment involves a couple of steps:

• Use your $100 investment to learn about investing. Most investment apps and brokerage platforms have extensive educational tools you can take advantage of.
• The most effective way to maximize your $100 investment is to make it a recurring one. If you're buying index funds or investing in stocks, set up an automatic transfer for every time you get paid. You'll be surprised at how quickly your account can grow.

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