Small Investment Options

A person with the intention of investing has to consider a few things or decide his objective of investing. According to his/her needs he/she can invest long term, meaning for a longer period and lower risk, or invest small. The term 'small' conveys two things, small amount of money, or a small time period, which possibly extends for 12 months, or even a few years.

Features to Consider

Now, when it comes to the features and specifications of good, small and short-term investments, first thing that you need to consider is your convenience and your requirements. In the investment sector, there are countless different types and subtypes of investments. The 3 primary features that you need to know are: return over investment, recurring annual investment amount and lastly, time period or life span of the investment. Apart from those you can consider the following features:

• Invest and Forget: Now this is one useful feature of small investments. There are some investment options wherein all you need to do is put in the money that you want to invest and forget about it, then, upon its maturity or expiry of time period, one can enjoy the returns.
• Recurring Annual Investment: On the other hand, one can also choose, the investment option where in you would have to invest a specified amount every year into the option. Now the recurring annual investment is to be treated as a liability as you need to compulsorily invest the said amount into the option, in order to keep it alive and get back the appropriate returns.
• Return on Investment: The Return On Investment which is also known as ROI, this is the total amount that you would receive back. The ROI is calculated by subtracting the total amount of investment from the total amount received (total amount received - total amount invested). You may also calculate a percentage rate of return on investment to get better overview of the returns which you are going to receive in due course.
• Time Span: In some cases you would also need to consider the time span and total amount which you would have to keep invested into the option as a unit and compare it with the other investments.

Apart from the aforementioned features you can also check some other features such as the provider of the investment option, your own future financial planning and its compatibility with the small investment option which you have chosen, etc.

List of Small Investment Options

The following is a quick list of some of the really good small investments which you can make as of today. A very quick overview of the significant pros and cons, and some of the really good features of the options have also been discussed.

1. Government Bonds and Other Treasury Bills
One of the best ways of stowing away small amounts of money for shorter time periods is into treasury bills and bond. Treasury, bills, notes, bonds, Treasury Inflation-Protected Securities (TIPS), I Savings, EE/E Savings are some of the best channels, most of which require about only $100 minimum investment. The advantage of such an investment option is that you can pay off the investment and wait till it matures, whereupon you can enjoy the returns. Some of these bonds and State government bonds and municipal bonds are some similar investments.

2. Common Stock, Corporate Bonds and Debentures
There are three types of contributions to the capital of a company. Common stock, corporate bonds and debentures are some of the common ones. All the three can be traded freely, and bonds and debentures also have a certain maturity or expiration dates upon which a certain accumulated interest is also paid off as a return on the same. The bonds and debentures are perfect investments, all you have to do is invest into them and wait for the returns. On the other hand, stocks or rather shares are the investments where you need to keep a tab on the prices of shares in which you have invested.

3. Systematic Investment Plans and Collective Investment Schemes
The Systematic Investment Plans (SIP) and Collective Investment Schemes (CIS) are professionally managed plans, such as mutual funds wherein you need to invest small sums of money periodically in the fund. In case of SIP, the amount that is to be invested, is not specified or mandatory, in fact for certain years, one may not even invest anything. The Collective Investment Schemes on the other hand have a certain mandatory investment is to be invested every year.

4. Roth IRA
Individual Retirement Accounts are probably the best accounts to invest your money into. The IRA can be opened in prominent banks and also in financial institutes and there is not mandatory minimum limit on the amount that can be invested into it. The IRA account is tax-free and it usually has an upper limit.

5. Bank Accounts
Banks offer countless deposit accounts where money can be deposited in any amounts, subject to upper limits and interest can be accrued on them. These accounts offer an interest rate which ranges from 5% to even 10% in some cases. These sort of accounts, are usually deposit-and-forget kind of accounts that offer returns upon maturity. On the other hand, there are also certain types of accounts wherein one needs to have a certain type of recurring payments throughout the time period of the account till maturity.

Of all these options, the best ones are the ones where all you need to do is invest the money, then sit back and wait till the account or the investment matures. The remaining ones, where you need to make recurring payments or you need to keep a watch on the market price of the investments tend to be a little troublesome.