Jasmine Birtles
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How to Start Investing with Little Money
Ruby Layram
24th Oct 2025
Think you need thousands sitting in the bank before you can start investing?
Think again.
The truth is, you can start investing with as little as £1, and thanks to modern money apps, it’s easier than ever to get going, even if you’re on a tight budget.
If you’ve ever thought “investing isn’t for me” because you don’t have a huge salary or piles of savings, this one’s for you. Let’s walk through how to start investing with little money and build future wealth without breaking the bank!
Also read: How to turn £10 into £10K
Start Small (Literally £1 Small)
Gone are the days when investing meant talking to a stockbroker in a suit. Now, you can open an investment account in minutes using apps like Plum, Moneybox, or Freetrade, and many let you start with just £1.
With Plum, for instance, you can set up automatic investments, round up your spare change, and even invest in ready-made portfolios.
You don’t need to understand the stock market inside out. These apps help you dip your toes in safely, spreading your money across lots of different companies and funds so you’re not betting everything on one horse.
The most important part isn’t how much you start with, it’s starting.
MY PERSONAL CHOICE- ETORO
Although apps like Plum are great for starting with £1, if you’re able to move your starting budget to £10 I would consider starting with eToro.
eToro has a whole host of features that make it an excellent platform to start your investment journey. These include Tori AI (your own personal AI investing assistant), copy trading (copy the trades of expert investors), and ready made Smart portfolios (take the stress out of building your own!).
How to Make Your Money Go Further on a Budget
If you’re working with limited cash, the key is to build consistency, not perfection.
Here’s how to make it easier:
- Automate it: Set your app to invest a few pounds each week. You won’t miss it, and it builds fast.
- Cut “invisible” costs: Cancel subscriptions you’ve forgotten about, shop own-brand, and use cashback apps. That freed-up money? Straight into your investments.
- Start with your goals: Investing without a purpose is like saving without a destination. Are you building an emergency pot, saving for a home, or growing long-term wealth? Your goals shape your strategy.
Even £10 a week adds up to £520 a year, and with compounding, that small sum can snowball into something surprisingly big.
Reinvesting: The Secret to Building Wealth
When your investments make money, whether that’s from dividends, interest, or price growth, you’ll face a choice: Spend it, or reinvest it.
If you reinvest, your money starts earning returns on its returns.
Think of it like planting a tree.
At first, you only have one small sapling. But as it grows, it drops more seeds, and each of those grows into its own tree. Before long, you’ve got a whole forest of money-making trees, and you only planted the first one.
That’s the magic of compounding.
How Compounding Turns Pennies into Pounds
Compounding is what makes small investments turn into real wealth over time.
Here’s how it works in numbers:
Let’s say you invest £50 a month, the cost of a takeaway or two, and earn an average return of 7% per year.
After:
- 10 years: You’d have around £8,600
- 20 years: About £25,800
- 30 years: Over £60,000
All from £50 a month.
If you start with £1 and keep adding regularly, compounding does the heavy lifting for you, the longer you stay invested, the faster your pot grows.
Don’t Wait for the “Perfect Time”
One of the biggest mistakes new investors make is waiting for “the right time to start.”
Here’s the truth: the best time to invest was yesterday. The next best time is today.
Starting small now beats starting big later. Because the sooner your money is in the market, the sooner it starts compounding, and the more time it has to grow.
Final Thoughts: You Don’t Need to Be Rich to Invest
Investing isn’t just for people with big bonuses or financial advisers. It’s for anyone who wants their money to work harder, even if that means starting with spare change.
Apps like Plum, Moneybox, and Freetrade make it easy to start small, stay consistent, and watch your money grow over time.
So don’t overthink it. Start with £1. Build the habit. Reinvest your gains.
And let time, and compounding, do the rest!
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Disclaimer: MoneyMagpie is not a licensed financial advisor and therefore information found here including opinions, commentary, suggestions or strategies are for informational, entertainment or educational purposes only. This should not be considered as financial advice. Anyone thinking of investing should conduct their own due diligence. When investing your capital is at risk.
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