Investing up to $2000 in A Start Up Venture

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Crowdfunding opportunities now allow anyone the ability to invest in a startup business venture for as little as $2000—and there are a variety of choices available too.  Average people now can invest in multiple business opportunities, thanks to a legislative action President Obama had put into motion when in office.  Previously investing in startups was only available to wealthy investors but now anyone can become part of a smart business venture, not just those venture capitalists.

Further, with the growth of the Internet even more opportunities are available.  So, today we are looking at so many business probabilities, which is great for business minded folks and it is certainly stimulating to the economy.  Since many folks are interested in investing online and promoting businesses from websites, let’s turn to what people can do from their very own home office.

Opportunities for Investors Online With $2000 Upfront

 

So, of course average Americans can invest in many different things, but how far $2000 can take them certainly can vary.  Once again, new entrepreneurs can gain funding from crowds online now.  When your part of that crowd that always dreamed of investing, these new changes are dreams come true, that’s for sure.  There are marvelous ways you can take your money and make it grow.  For instance, average working people can invest in:

  • Fortune 500 companies as long as they can prove financial capability without harm
  • Kickstarter Campaigns that show real promise
  • Private music labels and companies
  • Stocks and mutual bonds with higher interest rates
  • Start-ups online
  • New technology applications
  • And more

People can actually help individuals promote and publish a book nowadays, and actually earn money off such an investment.  Times are changing like never before.  However, with so many possibilities come concerns too.  Because unique business ideas are constantly emerging it opens the door for scam artists, which is a serious concern for the SEC.  Financial experts worry about fraud and new investors who aren’t as sophisticated being swindled or their identities being stolen.  Because of these concerns, many want to see safeguards so even the most amateur investors can have some protection.  There are things that people need to know before they start throwing any money around.  These protections are also meant to be beneficial to wise startup companies as well.

The SEC has specifics that they want the smallest investor to be informed of so mistakes can be avoided and retirement funds aren’t wasted either.  These new rules aren’t meant to harm but they are meant to make sure those individuals investing with only $2000 don’t get in above what they can afford.  So, let’s really closely examine what people need to know in the business world with these new rules in place.  So, in the next section we are going to share exactly what everyone needs to know—especially the average working American.

Some Important Information to Consider Before You Invest

 

The SEC does require all startups to disclose a financial report about themselves.  For those who are only starting off with $2000 up front, this can be a bit of a bump in the road, but the SEC will say it is all to protect people’s money.  Just remember, before if you didn’t have a large sum in assets and you didn’t make $200,000 a year you just couldn’t invest in anything.  It was unfair then and some things are still unfair now, but they’re improving.  For instance, you don’t have to be well off to invest in companies you like today, and a little bit pays off.  But, you must have some form of protection too.  Non-accredited investors must follow some serious rules, and sharing these with you will help avoid mistakes.

  1. For those who make less than $100,000 a year—the SEC limits you to investing no more than $2,000 in a business or 5% of the annual income.
  2. For those who make more than $100,000 a year—the SEC allows you to invest about 10% of your annual income. Still limited, but much better
  3. Some must share a full audit of their finances which feels a little too invasive—however, if you don’t follow the rules you’re out in the cold, it’s up to you
  4. You must pay for your audit if you’re the start up, but the investor doesn’t have to

Now that we’ve put out the more serious basics here, let’s really look at what you can do with that investment amount and where it might be most beneficial to you.  You must think outside the box, that’s for sure.

4 Great Investment Options for Those Who Have $2000 And What to be Skeptical Of

 

It’s important to remember that everyone is different and every investment scenario is different—you must do what is right for you.  Any investment has two sides to consider: risk and time. Some would say tolerance too, but that goes in hand with time.  If you’re still relatively young, then you have time to weigh your options.  You can invest money into things that take time to mature, but if you’re older you don’t have that same luxury.

Young people can take more risks too, because they have more time to recover from those risks.  Pre-retirees though don’t have this as an ally.  Preserving their finances is far more important than taking risks.  So, there are solid investment options out there that are very personal but take time too.  Some would say, “invest in yourself, you’ll always get the highest return”!

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Let’s look at 4 possibilities right now

  • Have you considered going back to school? Once again, if you have $2000 it might work very well to invest in your education if you’re still fairly young.  Then again, age doesn’t really matter here.  You’re never too old to learn and further your skills.  If you really want to make good money in your life and live with less financial worry, there’s nothing more important than building yourself up.

Statistics are showing that millennials who worked full time only earned a median of around $30,000 annually.  However, those 28 to 32 who went to college and earned a bachelor’s degree earned about $46,000 a year—over $12,000 more.  If you calculate that over a longer period it can really get depressing and emphasize how important college really is.  It’s a personal preference here, but you must really consider what is going to give you the best ROI!

  • Invest in mutual funds for a high return with accepted risks. You don’t have to invest in just one mutual fund account, you can go with 3 or 4 if you want to, and you could also get growth of anywhere between 5% or as much as 30% annually.  It all depends upon what kind of mutual funds you choose to invest in, and there are several.  You want to also really look closely on past performances of some of these mutual funds if you want to keep your risks low.  While you can’t base performance last year on every single year, it can give new investors an idea of what to expect and how mutual funds can fluctuate.  Mutual funds can go lower or higher each year, which is why many investors like them—they are flexibility.

Now, if you already know you don’t want to invest in a mutual fund with a higher risk and want to stay more conservative but still get decent growth– large cap stocks might be a legitimate option to consider.  Some financial experts might even recommend going with bonds, but either will normally give a 10% annual return—which won’t make you rich, but is decent.  Large cap stocks are recommended for those who don’t have much familiarity with the stock market and aren’t willing to put in a lot of time, or a lot of their funds.  This is about as conservative as you can get.

But, if you have more capital to work with and you’re willing to take more risks there are other options.  You can go with a mutual fund that offers a no load and no transaction fee.  However, you need to be aware these can’t be taken out early either.  Also, a balanced mutual fund can give investors a great return and it offers great equity too.  You might be pleasantly surprised this type of mutual fund offers 40% in bonds too.

  • Have you considered Marijuana stocks? True, you should have jumped on this bandwagon when Marijuana was first legalized in Colorado.  You might really have a small fortune by now but it is still a worthwhile investment.  The bottom isn’t going to be dropping out anytime soon and it is an easy stock to manage.  In fact, you just put in the money and sit back and let it grow.  Experts believe it to be a stock that will just continue to rack in the money for them without much work at all.  Now, it is important to recognize that Marijuana stocks are not all the same, which makes sense.  Some Marijuana stocks have extreme growth in a short period, but there is that risk there.  Do some real research and use smart judgement if you go this route for your investment.
  • Invest in Uber! That’s right, Uber continues to grow and become more successful.  Since it is still small, you can really get in good on this one with a small amount.  Now, just like any stock you want to pay attention to the fluctuations.  This is still one of the hottest tech companies trending right now.  This app made over $2 billion dollars in its first year, and has currently soared to well over $18 billion dollars.  So, if you want to invest wisely, this is really a smart one.

When you’re investing your money it is always to end up with a positive result.  No one wants to end up in the red, but remember—it can happen.  Now, if you can afford to start out in a trading account it is recommended to start small and be willing to face some losses.  While these might not be life changing amounts, they are something.  Growth or loss, you learn as you go.  You’ll develop skills and habits that will help you learn how to really navigate stocks, bonds and mutual funds with ease.  Further, you’ll broaden your business mind and can determine what start-ups are smart to invest in.  You’ll also learn discipline!  When you’re just starting out just remember you’re trying to learn long term strategies.  It’s a process, and just because you’re starting out small doesn’t mean you’re not going to achieve that satisfying success.  You will achieve those goals and sometimes having a financial planner can help.  Remember you saved your $2000 to try something new and you’re taking a leap into something new.  You never know what might happen and it’s exciting!  This could be the best thing you’ve ever done financially.

It’s always scary to invest your money the first time, which is why it keeps being emphasized to start out small.  This is also why there are regulations to protect investments and to prevent severe loss for new investors.  Many people spend half a year researching options, and that’s smart.  You should also talk to people who have invested their money in various projects and start-ups too, not just stocks and bonds and such.  Broaden your horizons and decide to invest in what you’re most comfortable with.  That will offer you the best experience.

 

 

 

The information provided within this article is for general informational purposes only. While we try to keep the information up-to-date and correct, there are no representations or warranties, express or implied, about the completeness, accuracy, reliability, suitability or availability with respect to the information, products or services contained in this article for any purpose. Any use of this information is at your own risk.

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