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Getting Started

How Much Money Do You Need?

With over 10,000 mutual funds and numerous other investment vehicles available, the investment choices may seem impossible to decipher. Many people ready to invest ask the questions, "Where do I get started?" or "What can I do with a little money?" These are great questions because everyone starts somewhere, and hopefully, ends up with more than they started.

Most companies require at least $250-$1,000 to open an account, then the option of investing $25-$250 per month (using automatic deductions from your checking account). So, you don't need thousands of dollars to start investing. However, the most successful investors contribute regularly on a monthly or quarterly basis to their chosen investment vehicle(s). To assess how much you need, the first step is to create an investment budget.

Some people say, "I donít like the term 'budget' because it means I have limits." We all have limits. We cannot fly by flapping our arms, we cannot breathe under water, and we cannot invest without any money. When you spend, you limit your ability to do other things, like save and invest. A budget allows you to come face-to-face with your limits while also revealing your opportunities to invest.

Use the list below to begin creating your investment budget. (Please note: the listed items are not to be taken as suggestions that you should be spending more money in these categories.).

Your Investment Budget Worksheet


Insert your monthly income or expenses

(1) INCOMING CASH (Income)


bulletGross Monthly Salary minus Taxes


bulletOther Income
(include alimony, child support, investments)




(2) OUTGOING CASH (Expenses)


bulletEmployee-Paid Benefits
(Includes health/dental/vision insurance, life insurance, disability and accidental death/dismemberment insurance, union dues, retirement plan contributions)


bulletRent or Mortgage


(includes gas, electric, water, sewage)


(Be real here -- include average local and long distance charges, not just the basic charges)


bulletCredit Card Payments
(list each card and the average payment, not the minimum required)


bulletLoan Payments
(include auto loans, student loans, personal loans, second mortgages, lines of credit)


bulletChild Care Payments
(include babysitter, day care, allowances given to teenagers)




bulletPersonal Insurance (not employer-related)
(include life insurance, property/fire/flood, auto/boat, credit , health/dental care)


bulletCharitable Contributions and Gifts


bulletPets (include food, health)




bulletEating Out
(include your daily cappucino and bagel, restaurant dining, snacks)


(include concerts, movies, theater, video rental, sports, books and magazines, clubbing)


bulletClothes (and shoes)


bulletHousehold Maintenance and Upkeep
(include home furnishings, gardener, repairs)


bulletPersonal Care
(include hairdressers, barbers, manicurists, massage therapists)


(include counseling, taxes, coaching, psychic)


bulletProfessional Associations and Club Dues




bulletNon-Retirement Investing


bulletOther Expenses




Subtract (2) from (1)
This is the money available to save or invest.


Do you get the picture? Now you've narrowed down the thousands of choices to (a) those that are immediately available to you and (b) those that are possible given some changes in your monthly spending patterns or a savings goal. For example, if a mutual fund you like has a $1,000 minimum requirement, you've now defined a goal in order to start. After you begin investing, you can flexibly decide how much you want to contribute regularly. The key is getting started. As always, talk to your financial advisor for strategies that best suit your individual needs.

There is no limit to what you can spend your money on. Yet, there is probably a limit to how much you can spend and still invest. In our consumer-oriented society, it may not be "sexy" to keep your money, but it is less sexy to be broke. You have the option to become a financial success.