I was in college when I first considered investing. I decided to talk with my grandma, who often talked about her broker -- her "little man" as she called him -- whenever I visited. She had done very well following his advice -- her years-long investment in Exxon had helped pay to build the house where she lived -- and I wanted to do just as well. But one phrase held me back:

"Only invest what you can afford to lose."

Obviously, as a college student, I couldn't afford to lose any of the money I was making. Between books, rent, food, gas, and beer, all my money was accounted for.

Oh, how I wish I had that decision back.

What I missed
For instance, I'm sure I could have scraped together $70 in my freshman year in mid-January 1984. That was enough to buy two shares of Sysco (NYSE:SYY). If I had done nothing with those shares between then and now, I would be looking at 64 shares, worth about $2,300, an annual return of more than 16%. And there would have been more than $220 collected in dividends over the years. Not for me, though, because I had to use that $70 elsewhere.

If, in the winter of my senior year, I had bought two shares of Microsoft (NASDAQ:MSFT) for $120, today I would have 576 shares worth more than $17,500 plus more than $2,300 in dividends. Not enough to retire on, but nothing to sneeze at, either. I certainly was aware of Windows and Microsoft at the time and had the opportunity to pick up shares, but I couldn't afford to lose that $120.

Smaller, more speculative companies (such as Microsoft and Sysco back then) might not have been my first choice. I might have preferred a larger, stabler company. For instance, in my junior year, I could have spent $140 to buy two shares of the well-established General Electric (NYSE:GE). If I had, I would have 48 shares today worth more than $1,800 and would have collected more than $280 in dividends. But I didn't because I couldn't afford to lose that $140.

In my sophomore year, I could have followed my grandma's lead and picked up two shares of Chevron (NYSE:CVX) for $60 and had eight shares worth about $560 today. All right, maybe not the best investment, but the nearly $100 in dividends would have helped take the sting out. I didn't even get that, though, because the $60 was too important to set aside.

All told, I felt I couldn't afford to set aside $390 during the course of my college career. There was beer to buy, after all! Today, instead of $22,000 in stock and $2,900 in dividends, I have fading memories of drinking that beer -- lousy beer at that.

The mistake
My biggest mistake wasn't listening to Grandma but misinterpreting her. I'd decided that I needed all the money I was making just to keep body and soul together and entertained.

What I should have realized is that in any situation, there are always a few dollars that can be set aside to invest. Skip the rental of a movie, eat out less often, don't pay vending machine prices for soda. The money is already spent, even "lost," on other things that are usually short-lasting, so why not "spend" some of it by investing it? With discount brokers charging only a few dollars for online trades, just about anyone can begin a portfolio that, over time, can grow to thousands of dollars.

"Pay yourself first"
It may not seem possible when living on a tight budget, but setting aside just a few dollars a week can lead to big things down the road. This is the idea of paying yourself first -- setting aside a little bit now in order to have more in the future. With low commissions, using a few dollars to buy a few shares of stocks is easy. While no one can guarantee that investing in these companies will pay off, not investing anything will lead exactly nowhere.

If you'd like a few ideas on where to find that extra cash, we can help. In our Motley Fool Green Light personal finance service, co-advisors Dayana Yochim and Shannon Zimmerman offer several suggestions each month on how to find those extra dollars that can be turned into heaps of cash down the road. If you're interested, check out the service free for 30 days. There's no obligation, so give it a try. We think you'll be glad you did.

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Fool contributor Jim Mueller is glad that he finally learned the "pay yourself first" lesson and did begin investing. He owns shares of Sysco, and his wife owns shares of Microsoft and General Electric. Sysco is an Income Investor recommendation. Microsoft is an Inside Value pick. The Fool has a rigorous disclosure policy.