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How to Invest $100, and What It Could Become in 30 Years

Your First Investment • Beginner Investing • 6 min

What this lesson is about

$100 feels too small to matter. The math on what it can actually become over decades says otherwise, especially once you make it a habit rather than a one-time move.

2 parts · a quick check after each · then the quiz

Part 1 of 2

Investing, $100, might, seem, too, small, to, worry, about,, but, think, again., Using, the, formula, FV, =, P(1, +, r)^n,, that, $100, can, grow, to, about, $761, after, 30, years, at, a, 7%, average, annual, return., That's, more, than, 7, times, what, you, started, with,, and, you, don't, need, to, add, another, dime., Plus,, fractional, shares, mean, that, $100, isn't, stuck, by, the, price, of, a, full, share., You, can, put, it, in, a, broad, index, fund,, spread, it, across, a, few, investments,, or, buy, part, of, an, expensive, stock.

The, real, magic, happens, when, you, make, investing, $100, a, habit, rather, than, a, one-off, event., If, you, invest, $100, today, and, keep, adding, $100, every, month, for, 30, years,, you'll, end, up, with, a, much, bigger, total, than, just, the, initial, $100., It's, not, about, any, single, contribution, being, large;, it's, about, how, consistent, contributions, grow, together, over, time.

Quick check

Using FV = P(1 + r)^n, roughly what does $100 invested once and left untouched grow to after 30 years at a 7% average annual return?

Part 2 of 2

Insider, Angle:, That, first, $100, does, more, than, kickstart, compounding., It, lays, the, groundwork., You, open, a, brokerage, account,, learn, how, to, buy, and, track, investments,, and, develop, the, habit, that, makes, adding, the, next, $100, (and, the, next), much, easier, than, starting, over, from, zero, later., Waiting, to, "get, serious", until, you, have, more, money, often, just, holds, you, back,, including, the, years, of, compounding, that, first, $100, could, already, be, earning.
Try, This:, Using, FV, =, P(1, +, r)^n,, find, out, how, much, $100, grows, after, 20, years, and, after, 40, years, at, a, 7%, average, annual, return., Then,, figure, out, how, much, adding, $50, every, month, for, 30, years, (on, top, of, that, initial, $100), would, increase, your, total., Even, a, rough, estimate, will, show, you, the, difference, clearly.
Compound growthChange the amount, the rate and the years. The curve is the point.

Quick check

Why does a small starting amount, like $100, still matter even though it seems too small to "do anything"?

Quiz

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