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How to turn $100 into $49,195 through automation

Yahoo Finance contributor
·Contributor
·5-min read
Here's how to automate your way to investing success, according to Molly Benjamin. Images: Getty, Supplied.
Here's how to automate your way to investing success, according to Molly Benjamin. Images: Getty, Supplied.

We automate so much of our lives these days from Netflix, to groceries and even our toilet paper.

It’s no surprise that finance apps are letting us automate our investments. This is great news for those of us who are busy, forget or ‘just never get around to investing’.

A common question I get is which investing platform do I choose.

I like comparing choosing an investment platform to selecting a bottle of wine.

There are big suppliers like Dan Murphy’s, then smaller boutique online ones like Different Drop.

Some are cheaper, some have a bigger wine range, some deliver, and others have better customer service but at the end of the day you’re still buying wine.

Investment platforms are similar in choice, large, small, low fee, higher fee etc.

Watch: Molly Benjamin discusses how to set and hit money goals.

The fact is investment platforms all do comparable things, they help you buy shares and ETFs (exchanged traded funds) so don’t let this stump you and stop you in your investing journey.

Thanks to technology and the internet there has never been an easier time to invest!

Investing is just so accessible (if you can shop online you can invest online) no more faxing forms or going through mountains of paperwork.

Just whip out your phone and you can be the proud owner of an ETF within minutes.

At Ladies Finance Club (LFC) we like our investment strategies like we like our ice cream, vanilla, just plain and simple.

We are all about getting rich slowly, it’s not sexy, we aren’t wolfing it up on wall street or checking our investments 50 times a day and freaking out when there’s a slight drop.

That’s why I recommend automation, it takes away the emotion. And as legendary investor, George Soros says: “If investing is entertaining, if you’re having fun, you’re probably not making any money. Good investing is boring.”

How to automate your investments

We are big believers that if you have set up an emergency fund of three to six month’s worth of expenses, gotten out of any high interest debt, not needing the money for the next three years and have a basic understanding of why you’re wanting to invest (#lifegoals) then you’ve got this.

Automating your investments is where you set up a direct transfer or direct debit from your bank account to an investment platform regularly (fortnightly, monthly etc).

Then they invest your money into your chosen product.

If you invest $100 every month regularly into a global ETF with a return of 7 per cent, in 20 years’ time that money could be worth $49,195 (MoneySmart) not including fees.

Thanks to the likes of Pearler, Spaceship, Stockspot, Vanguard and many more investment apps and platforms, automating your investments has never been easier.

There are real benefits to automating your investments too!

Not only the fact that you save time (because you’re not having to constantly look for logins and actually do it), but it helps you avoid mistakes, lowers your brokerage fees and you are achieving your goals without even having to think about it.

Plus when you’re automating on a regular basis you’re also using the strategy of dollar cost averaging.

Let’s say you had $1000 to invest, instead of investing it all in one go, you invest $200 every month for five months.

If the market goes down you get more bang for your buck but if the market goes up, you will buy fewer shares but over time the price generally averages out.

Apps to help you automate your investments

Smiling young businesswoman surfing net on mobile phone. Female commuter is standing in financial district. She is having black curly hair.
And you can do a lot of it on your phone. Image: Getty.

Here are some easy to use platforms that allow you to automate your investments.

Pearler – these guys are the new kids on the block and their autoinvest feature direct debits from your linked bank account, into your Pearler account and then into your chosen fund – you can set up when and how often you want to contribute over time.

Minimum initial deposit is $500.

Spaceship – these space dudes offer weekly, fortnightly or monthly investments into their Spaceship Voyager account.

Minimum initial deposit is $50.

Vanguard Personal Investor – although you cannot make regular automatic deposits directly into a managed fund, you can however make regular deposits into your Vanguard Cash Account by setting up a regular transfer from your bank account using your Vanguard Cash Account's BSB and account number.

They don’t charge you any brokerage on Vanguard products.

Minimum initial deposit is $500.

Stockspot – offers automatic direct deposits from your bank account to your investment account without having to pay brokerage each time!

Minimum initial deposit is $2,000.

Commsec Pocket - allows you to set up an automatic investment in an ETF every fortnight or month with only a $2 brokerage fee each time.

Minimum initial deposit is $50.

Remember investing is not about doubling your money overnight, or listening to uncle Terry’s stock tips.

It’s about slow and steady contributions to grow your future wealth.

As James Clear, author of Atomic Habits says, “Goals are about the results you want to achieve, systems are about the process which leads you to those results,” and that’s what automating is, it’s creating your own system to achieve your goals.

Molly Benjamin is the founder of Ladies Finance Club, which empowers women to get money savvy and take control of their financial futures without the boring bits.

Take control of your money and learn to maximise it with the Women’s Money Movement! Join the club on LinkedIn and follow Yahoo Finance Australia on Facebook, Twitter and Instagram, and subscribe to the free Fully Briefed daily newsletter.

Image: Yahoo Finance
Image: Yahoo Finance