How to Invest $20 [Complete 2022 Guide]

Want to invest $20?

There are many methods you might consider to grow your money, but which is right for you?

In this post I’ll explore some of the best ways to invest $20, how to invest $20, and how much money you could make from your $20 investment. Let’s get started!

Best Ways to Invest $20

Below are some of my favorite ways to start investing $20. It’s important to understand that the first step of reaching your financial goals is to get started, even if it’s only $20.

How to Invest $20 - Invest in Stock Market

Invest in the Stock Market

One of the easiest ways to invest your $20 is by purchasing stocks.

By investing in the stock market you can grow your money with an average return of around 7% to 8% annually. While this might not sound like much, your money will compound over time to increase exponentially.

The stock market offers a variety of options you can choose to invest money. Some of the most common are index funds, ETFs, mutual funds, or individual stocks.

To determine which assets to purchase, you’ll want to analyze your financial goals and risk tolerance.

Index funds, mutual funds, and ETFs are the most diverse assets in the stock market meaning you’ll have less risk than purchasing individual stocks. I’ll explore each asset below.

To start investing in the stock market, I recommend using the Acorns app. With this app you can easily purchase your favorite stocks, mutual funds, or a plethora of ETFs to start your investment portfolio.

Need another reason to begin investing with Acorns? You’ll get a FREE $10 when you register with the link below!

There are several types of accounts you can use to invest in the stock market. For example, a traditional brokerage account will have the highest taxes, but a 401(k) or Roth IRA will limit your ability to withdraw your money.

Fractional Shares

When investing 20 dollars, you’ll need to be capable of purchasing smaller chunks of investments – and that’s exactly what fractional shares do.

Also called stock slices, fractional shares allow you to purchase a portion of a single stock. For example, the price of 1 share of Amazon stock is currently $3,327. That’s a lot of money!

With fractional shares, you can purchase as little as $5 worth of Amazon stock giving you access to many different investing options.

Buy Fractional Shares

Individual Stocks

Individual stocks are the most risky method of investing in the stock market.

Because individual companies can have mixed results from quarter to quarter, their stock price can fluctuate daily.

To minimize these affects, you might consider using dollar cost averaging to purchase your initial investment. In theory, this can help to decrease the short term volatility of your purchase instead of making one lump sum purchase.

Related: Make Money While You Sleep

Mutual Funds

You can think of a mutual fund as a group of stocks and other investments. A mutual fund is much more diverse than single stocks – making it a wise option for long term investors looking to grow their money without a massive risk tolerance. Many mutual funds will cost more than 20 dollars – so you might have to opt for another investment if you are limited. Aim to find a low cost mutual fund so you don’t lose any of your profits.


Just like a mutual fund, an ETF can be thought of as a group of stocks and investments grouped together. These investments typically have very low fees although the price tag can be more than $20. ETFs are among the safest ways to invest in the stock market and are highly recommended by many personal finance experts.

Related: Investments That Pay You Every Month

Grow Your Money with a High Yield Savings Account

Don’t want to worry about losing your money?

A high yield savings account is one of the least risky ways to invest $20 – perfect for those with a low risk tolerance.

This type of savings account acts just like a traditional savings account or bank account with the main difference being the much larger interest rate.

Some high interest savings accounts can offer over 10 times the amount of interest as a traditional savings account.

My favorite account is the CIT Bank savings account. It’s completely free to open and has no fees associated with it. Register below to open your account and starting growing your money!

Rental Home to Make Passive Income

Invest in Real Estate

While many real estate assets will require higher initial investments, it’s a great investment strategy to keep in mind as your money grows.

When you invest money in real estate it can grow in multiple methods.

Because most real estate assets will increase in value over time, this can be one of the primary methods to make money. Depending on the real estate market that you’re currently in, your home might increase in value significantly in just 5 or 10 years.

There are many real estate investments suited for any investor.

For example, you could opt for commercial real estate that is more lucrative than residential real estate. Within these niches, you could opt to purchase rental properties or invest more passively with crowdfunded real estate.

No matter what method you choose to invest in real estate, it can be a great way to reach a diversified portfolio.

Related: How to Invest and Make Money Daily

Invest in Art with Masterworks

While investing in art has always been one ways many millionaires grow their money, it hasn’t been until recent everyday investors could have the same capabilities. With platforms like Masterworks you can invest in famous pieces of artwork with much less money. With an average return of 15% annually, this is a great way to invest!

Invest in Bonds

If you’re searching for a low risk method to invest your $20, you might consider investing in bonds. While there are several types of bonds, government bonds tend to be the safest option.

When compared to the stock market, your returns will often be lower, but your risk will also be less.

Related: Best Compound Interest Investments

Start a Small Business

While there aren’t many businesses you can start for $20, you might be surprised there are a few.

Many service based businesses can cost less than $20 to get started.

For example, starting a cleaning business might not cost you anything if you already have the supplies. You can mention your services on social media sites for free advertising.

Another great business to start would be an online business like a blog or website of your own. While blogging won’t be the fastest way to grow your money, it can have some of the best potential.

It will likely take you one year before you start to make serious money from your blog, but after that your earnings can grow exponentially.

How to Invest $20 - Invest in Yourself

Invest in Yourself

Investing in yourself can be a great way to invest $20. There are many methods you can choose to grow your knowledge.

For example, you might purchase Skillshare to learn new skills. When you use the link below, you’ll get 14 days of free learning. You can take online classes in photography, coding, and much more.

By investing in yourself you’ll be capable of increasing your future income by using your new skills.

Peer to Peer Lending

If you just want to make a little money from your investment, peer to peer lending can be a wise option. While it doesn’t have the highest rate of return, it can be among the easier ways to invest your money.

You can think of this investment similar to purchasing a bond.

How to Invest $20 - Invest in Bitcoin


This is the most speculative investment on the list but I think it’s worth mentioning as an option. If you have a high risk tolerance and you’re seeking larger returns, cryptocurrency can be a good option.

The main downside of this alternative investment is that is can be extremely volatile. Some days your investment could grow by 10% or 20% while other days it could fall by more than 30%.

While some personal finance experts wouldn’t consider cryptocurrency as an investment, I believe that some can be. The key is to keep your portfolio diversified. I wouldn’t allocate more than 5% or 10% of your total portfolio to an alternative investment like cryptocurrency.

Some of the most reliable cryptocurrencies include Bitcoin, Etherium, Bitcoin Cash, and a few others.

To get started purchasing cryptocurrency, I recommend using Coinbase. The free app allows you to buy and sell many different cryptocurrencies.

Best Investing Platforms

There are many robo advisors and investment platforms you can choose to build wealth and begin investing. So which ones are the best?


Another great way to invest in the stock market is with Acorns. This robo advisor app will automatically round up your purchases to invest.

As with any robo advisor, you’ll want to consider any management fees that are charged. While the fees are typically small, they can add up the more money you invest.

SoFi Auto Invest Account

This robo advisor platform is a great way to build your wealth and invest your $20. Compared to other robo advisors, SoFi offers the benefit of having a built in money management platform that allows you to open a standard checking account and much more.


With Public, your investing becomes more social. This platform allows you to share your investments with your friends and family – encouraging them to grow their money as well. The minimum investment is low to get started making it a great option.


If real estate investing is a priority for you, Fundrise is one of my top picks to build wealth. You can get started investing with a $500 initial investment – which is much less than many other crowdfunded real estate investing platforms.


If you’re looking to invest in cryptocurrency, Coinbase is the best option to get started. The free app is easy to navigate and there are no minimums to get started. Open your free account below!

Stash Investing App

If you’re looking for an investment account that is easy to maneuver and invest your money, Stash is a great option. The account minimum is low and it includes a small monthly fee for passive investing.

They offer many investment options when you start investing plus you’ll get a free $5 when you register with the link below. What’s better than free money to invest??

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Investing Tips to Maximize Returns

Below are some helpful tips when investing money.

Diversify Your Investments

You don’t want all your eggs in one basket. When it comes to investing, this means spreading your money across multiple assets to limit risk.

If you are currently invested heavily in the stock market or real estate, consider another investment like bonds or a small business.

Stay in it for the Long Run

You won’t become rich overnight when investing $20. You’ll invest your money for more than a decade to maximize your returns and build wealth. While you might only start with a little money, this money will compound and grow over time.

Utilize Retirement Accounts

Retirement accounts like a 401(k) or Roth IRA offer many tax benefits over a traditional brokerage account.

By investing your retirement savings in an appropriate retirement account you can grow your money without accruing a large taxable income.

You likely don’t actively manage your 401 (k) account, but it could be a smart idea.

Limit Fees

Some robo advisors will take fees from your investments for the work that is done. It’s usually a small percentage of the entire fund. Save money by limiting fees as much as possible.

What to do Before Investing?

There are certain times your money might be better spent elsewhere rather than investing. No – that doesn’t mean it might be better spent on the latest video game but other things like debt or an emergency fund. Depending on how much money you have, you might consider these options.

Establish an Emergency Fund

You’ll likely experience an emergency expense sometime over the course of the next year. Will you be ready for it? If not, establishing a proper emergency fund should be a priority. Even if it’s just $20 or $50 to start, the goal is to get started.

With investing, there is a chance that you could start losing money – even if it’s just a small amount. Because past performance is not indicative of future results, having an emergency fund is a good idea.

Become Debt Free

High interest debts can cripple your financial goals. Credit card debt, student loans, personal loans, and other high interest debts can make managing your money a challenge. Aim to pay down as many debts as possible before you start investing.

Final Thoughts on How to Invest $20

While you’re not going to become a millionaire overnight by investing $20, you can grow your money over a few years and start to see your earnings stack.

If you want to reach financial freedom, starting with a $20 investment is a no brainer. Whether you choose to grow your retirement savings with a 401(k) or use a standard brokerage account, there’s no wrong choice when it comes to investing your money.

Download My FREE Income Ideas Cheat Sheet!

Make. More. Money. Join 10,000+ subscribers learning how to boost their income and take control of their finances.

Don’t worry – we hate spam too. Unsubscribe at any time.

Forrest is a personal finance, entrepreneurship, and investing enthusiast dedicated to helping others obtain life long wealth. He owns several different blogs and is also passionate about health and fitness.

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