Is it Worth Buying Less Than One Share?

PUBLISHED Mar 27, 2022, 8:32:31 AM        SHARE

imgStaff Writer

Buying less than one share is worth it

Buying fractional shares is worth it. Fractional shares allows investors to invest with just $1 dollar! This eliminates the barrier of entry into the stock market. The stock market is an unbiased way of growing wealth. Since there is essentially no minimum to buy stocks, the time to buy stocks is now.

Fractional shares cost one Coffee

Fractional shares allow almost anyone to invest in stocks. A typical coffee is about $2.25. If you skip one coffee a day, you can take that $2.25 you saved and put it into a stock thanks to fractional shares. Over a one month period that adds up to $60 in investments.

Get Your Kids Involved

If you're a parent, buy one less toy for your child and you can use that money to invest in their future. If your son or daughter are old enough, you can even ask them to help you make the investment decision. Though a child may not yet understand business, they do understand what they like. Stocks associated with Roblox, YouTube, and Minecraft are easy examples of products your children may like that may be good long term investments.

The downside to Fractional Shares

The downside to fractional shares is that you do not get to vote in corporate elections or for shareholder proposals. Typically, shareholders vote for members of the board. This board elects a CEO and is responsible for the governance of the company and the accountability of the CEO. Shareholder proposals change the governance and direction of the company. Tesla had multiple shareholder proposals related to the diversity and inclusion of the company in 2021.

Guidance for Beginning Investors

For new investors, check out our new investor tips guide as well as our ultimate guide for beginning investors. Here are some tips for new investors:

  • Buy stock in companies that you know
  • Start investing now, even if it's in fractional shares
  • Buy stocks when everyone else is selling
  • Dividends are typically quarterly payouts to investors for owning stock. Get some dividend stocks to round out your portfolio and manage your risk.

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