facebookNew to investing. What is considered a 'minimum' amount for investment? - Seedly

Anonymous

19 Feb 2020

General Investing

New to investing. What is considered a 'minimum' amount for investment?

I'm quite risk adverse and hence, have been hesitant on putting my money out for investment. I know I'm very late since I'm 28yo but I believe better late than never. I'm getting married next year so I'd definitely save some cashflow. Is a low capital of 10K sufficient to kick start for ETF/REITS/RSS? Can I go below this amount or is it too low to begin with?

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Super, better late than never.

'minimum amount' can have several meanings:

  • mimimum total amount to be accepted to open up a brokerage account

-minimum total amount to be exempt from account maintenance fees or f.ex. quarterly sent paper statements by regular mail

-minimum total amount for being investing to "be rational" with commission fees that should not exceed a given percentage (set by yourself, but fees ideally nowadays should be zero, like with some U.S. online brokers since 10/2019. They anywhere else today possibly should never exceed 1%, better less.

-minimum total amount for being accepted for some mutual funds/unit trusts (anyway never buy mutual funds, fees much to high; stick to ETFs)

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Today with technology, you can invest with as little as $1 (certain digital advisories), or $100 (banks RSP program).

$10k is a better position than me. i started with initial capital of $500 in RSS.

but I would also suggest split the $10k into i) different portfolios so you can monitor the performance and after sales services, and ii) average in monthly (dollar cost average)

for "risk adverse", you can take a look at singapore gov savings bonds (SSB) or nikko AM bond ETF.

as you are getting married, i guess more expenses will happen in future, planned or unplanned. definately you will want investments which are liquid (ETFs and SSB) rather than top up CPF or endownments (locked up for years).

hope this helps.​​​

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