Faithful reader, Matt, recently emailed me about his experience with my article, How To Invest $100, and we got to talking about the things he had done and his thoughts on life, the universe, and everything. Matt tried to get a group of friends to pitch in $100 each with the thought that they’d try to make it grow into $20,000 and then invest in something big. You’d think $100 was a small enough investment, especially for such a learning experience, but all of his friends balked so he forged ahead. I believe that’s when he saw my article and saw how he could get his bankroll increased faster. After talking about his experience, Matt gives some observations about his friends who don’t seem to understand the value of money because of credit cards and our “instant gratification” life.
Even though a few of them showed a bit of interest, none of my friends ultimately followed through, so I forged ahead and made the $100 investment myself. I first tried to start three Sharebuilder  accounts simultaneously (using three different promotional codes), but they would only honor one code. So, I put in $100, made three trades at $6 each, and was awarded my $50 bonus. This turned my $100 into $132.
I was able to repeat this process using a fourth code for a $50 promotion, and executed only 1 trade to earn it, so my take on this code was $44. This brought my total to $176.
Matt is referring to my advice of signing up for Sharebuilder  accounts and using the Sharebuilder promotional codes  for some free money. So far, in a short while, he increased his $100 to $176 with no risk, a return of 76%.
Technically, you only need a small amount of money to qualify for the Sharebuilder promotion, so while I was shooting for it the second time, I followed your link to the bank promotion website and chose the one that looked the most promising: Bank of America has a $100 bonus just for opening a checking account with them. I opened the account with $50 of my Sharebuilder money, and was pleasantly surprised to see that they give you the $100 after only a week or so of having your account opened. I still have to keep the account open for 60 days, but I already have that $100 in my pocket to continue working for me. This brought my total to $276 (plus I have about $8 worth of stock shares).
This is the second step in the How To Invest With Only $100  post where you apply for a Bank of America account for the free bonus money. Using some of the proceeds, Matt was able to increase his funds to $276+, though he would not be able to close that BoA account for 60 days.
Overall, it’s taken me only 8 weeks to go from $100 to $276, and I plan to continue to increase this bankroll. One thing that’s impressed me as I’ve gone through this process is how easy everything is. With only a few minutes of my time, I can set up an online account. Now that I’m comfortable doing it, I can see how I can turn that $100 into a side income of about $1200 per year with no more than 15 minutes of at-home work every week.
The promotions are a sure thing, and so I don’t mind putting all of my “investment capital” into one basket. But I’d like to explore other types of investments as soon as my bankroll gets big enough to spread around. I’m only risking $100, after all.
To me, this is a great way to learn about making money as well. I’m keeping this $100 (now $276) separate from the rest of my money, but after seeing how quickly it grew, I jumped on the chance to put some of my emergency fund into a local bank that was offering $105 in promotions. So, I not only made $176 from my $100, but I also learned how to make an additional $105 from money that was sitting in a savings account anyhow.
Here is where the discussion moves to life, the universe, and everything…
In talking with my friends about all of this, I hit on an interesting phenomenon (if you’ll indulge my digression from an already-rambling email). I was right there, telling them that they could put up $100, spend very little time, and make hundreds of dollars in a couple of months. I’m not a salesman, I’m a trusted friend of theirs. But they were universally uninterested in doing it. Why were they ignoring free money? The answer is both depressing and simple. Their money problems are not caused by the fact that they don’t earn enough money. Their money problems are caused by the fact that they spend too much. I realized that all of my friends have “elastic spending habits” that expand to match the money in their pockets. The idea of having a hundred extra dollars in their pocket wasn’t exciting to them, because they would just blow the hundred dollars on crap anyhow. They literally don’t see the value of $100. And my friends aren’t rich, Jim. They all have steady jobs, but live with credit card debt.
People who aren’t on budgets have little-to-no incentive to save up a little extra money. Their lives have taught them that if they don’t spend the extra money on a DVD today, they’re going to spend it on pizza night tomorrow. So they might as well go ahead and buy the DVD.
For those of you who made it this far, what do you think?