Should You Invest if You’re Hand to Mouth?

September 13, 2019

Though common wisdom says to always save when you
can, it’s not feasible or functional for everyone. For those who live hand-to-mouth
every paycheck, with little to spare, investing in the future just doesn’t make
sense.

Sure, stocks and bonds pay off long-term – but what
good does that accomplish now, when you need the money most?

Luckily, there is a way to overcome this. Here are
simply ways you can invest in yourself now, so you can improve your
financial future without breaking the bank. 

Invest in a Better
You

“Just get a better job” isn’t good advice – all by
itself. Instead, you can focus on improving yourself to be more appealing to
better or secondary jobs.

Spend your free time, as well as any influxes of
cash you receive, finding a quality set of interview clothes or taking small
classes to build your resume. If local classes don’t fit your schedule, budget,
or interests, you can find suitable replacements online, on websites like Skillshare.

Whether it’s advancing in your current job or
finding a new one, you need to build yourself up first. 

Invest in Quality
Products

What’s the greatest drain on finances for low wage
workers?

Buying cheap items that will need replacing very
soon.

Finding well-made items doesn’t have to be
expensive, either. If you’re seeking a new pair of work shoes (that can hold up
to the strain of the job), try patrolling your local thrift or consignment stores.
These places sell second-hand items that are durable – just no longer useful to
their original owners.

Businesses that sell cheap, easily broken products
are banking on the fact that you want a low-cost and fast option. Putting in
the time (and money) to invest in higher quality items is worth it in the end,
since you aren’t pumping endless cash into things that quickly need replacing. 

Invest in your Debt

Is your less-than-satisfying financial situation caused
by a debt dominating your budget? Then it’s wise to put your extra money toward
that first. While you may be able to get by on your current income if you
ignore it, that debt will only snowball – worsening your long-term finances.

If you lack extra money, then small loans or a
credit card with a lesser interest than your original debt may help you get on
top. That way, you’re removing the debt itself – not just paying off its
interest.

Invest in Stocks
and Bonds…

…only once you’ve saved up a couple hundred dollars and feel safe
doing so.

You may be tempted to invest small amounts of money over time. While
that’s sensible, buying stocks in large groups helps keep transactional fees
down. These would otherwise become a real drain on your savings.

Until you have a larger amount of cash to play in this bigger arena, work
towards a situation where you can safely set aside money for retirement.