Financial Literacy

Finding more money to invest

We all know how important it is to invest money, especially when it comes to planning for retirement. Having enough money in your retirement plan could be the difference between a comfortable retirement and having to work until very nearly the end of your life.

But how do you invest if there just doesn’t seem to be enough money left at the end of the month?

Sometimes finding money to invest takes tightening a few bolts, financially speaking, and other times it requires radical action. More commonly, it takes finding money in different places or even creating new sources. Whatever it takes to find the money you need to invest, the end result will be well worth the time and effort you have to give to make it happen.

Getting started

Whether you have a little bit of money right now, or even none at all, the first step is to get you started in a new direction. To begin with, even if you’ve never been a saver or investor in the past, understand that today is a new day, and you’re charting a new course. From now on, you will be a saver, and a short time later you’ll also be an investor. Accept it, and commit to it.

Then start taking action with small steps. What you want to do is to set goals to achieve small, doable steps that will encourage you to take on bigger, more challenging ones later.

For example, if you have no savings, set a goal to have $1,000 saved within, say two or three months. You can do this with a combination of efforts that might include cutting all expenses that aren’t absolutely necessary for the duration, selling some personal effects on eBay, or with a garage sale or even earning some additional income.

Earning more income

This is often important if you have no savings and live on a tight budget. If you’ve never thought about how to do this, or if you don’t think you have the skills to make it happen, consider that making extra money really depends mostly on any talents that you have and we all have them.

There are more ways to make extra money than most of us are aware of. And let’s face it, most of us have been doing the same job for years and don’t think that we can do anything else. Think again.

You can get a part-time job, but you can also consider some sort of side business as well. Any skill that you have—tutoring, computer repair (regardless of how minor), yard or auto maintenance, typing, etc., can be turned into a side business. And usually, it’s when you have a real need to do it you’re able to make it happen.

Cutting expenses

To help with your extra income earning efforts, you can increase your cash available for savings even more by cutting expenses. Earlier we mentioned cutting non-essential spending until you accumulate $1,000 in savings, but you don’t have to stop there.

You probably have certain ongoing expenses that are eating into your budget that you never think of as anything but essential when they really aren’t. For example, do you need cable TV or lawn service? If you need to save money, and those services aren’t absolutely critical, you could eliminate them and free up some more money for savings or debt payoff.

Getting out of debt

Getting out of debt is another important way to save money for investing even if most people don’t think of it that way. By eliminating debt, you free up more of your paycheck to go into savings and investments. And even if you can save some money while carrying your debt, think about how much more you’ll be able to save if you can make the debt go away?

Like everything else, start paying the debt in small steps. The popular “debt snowball” is an excellent way to do it. Start by taking on your smallest debt first, and once that’s paid off, you’ll have more room to take on the next largest debt. Once all of your debts are gone, the money will begin flowing into your savings much more easily.

Once you have savings to cover your basic living expenses for three or four months, you can begin moving new money into investments. And when that happens, you’ll be on your way to reaching your long term investing and financial goals.


  1. Shannon-ReadyForZero

    I really like the way you urge us to let go of the past and move forward in your quote, “From now on, you will be a saver, and a short time later you’ll also be an investor. Accept it, and commit to it.” It can be hard to think this way, but making the mental switch can make all the difference!

  2. BeatingTheIndex

    One important point here is you need patience before you see the fruits of your action. just remember that the turtle won the race.

  3. Michal

    There is no doubt that each small step to save money, one day provides a good collection of saved money. However using this saved money in right direction is necessary to make more money from it. Some people do it as planning for retirement, to lead a good life but I follow these small steps to save money and utilize it for more money.

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