Download Saving and Investing on a Shoestring: Finding Money to Save

Saving and Investing on a Shoestring:
Investing With
Small Dollar Amounts
Debra Pankow, Ph.D., family economics specialist, and Marina Serdiouk, graduate student
Types of Investments

Tax-deferred employer retirement plans

IRAs (individual retirement accounts)

Stocks

Fixed-income investments

UITs (unit investment trusts)

Mutual funds
Tax-deferred
Employer Retirement Plans

Federal tax write-off for
amount contributed

Tax-deferred growth of
principal and investment
earnings

Automatic payroll
deductions
Individual Retirement
Plans (IRAs)

Tax-deferred growth
of principal and
investment earnings

Traditional IRA

Roth IRA
Stocks

Dividend Reinvestment
Plan (DRIP)

Investment clubs

Online investing

Stockbrokers

No-load stocks

Buying stocks without a
broker
Fixed-income Investment

“Loanership”
investment


Treasury securities:
Treasury bills, notes
and bonds require
$1,000 minimum
investment
Purchased through a
Federal Reserve
Bank, financial
institution or broker

Other types:
municipal, corporate
and zero-coupon
bonds

Exempt from state
and local income tax
and subject to
interest rate risk
Ratings Service
Unit Investment Trusts (UITs)

Long-term investment

Minimum investment is
$1,000

Less expensive way to
purchase bonds

Purchased through a
broker

Interest income may
be taxable
Mutual Funds

Minimum
investments as
low as $50 a
month

Fees vary

Purchased
through broker
or direct from
company
Other Suggestions

Self-employment plan

Automatic monthly
investments

Dollar cost averaging

Never too late to start!
You can do it!