How Much Money Do You Need to Buy Mutual Funds?
See Minimum Purchase Price for Most Mutual Funds
So you've decided to buy a mutual fund. How much money do you have? In many cases, you'll need thousands of dollars to buy mutual funds. But there are a few exceptions where investors can get started investing with mutual funds for $100.
The exact amount for the minimum initial purchase will primarily depend upon the mutual fund company.
Minimum Initial Purchase for Mutual Funds Broken Down By Mutual Fund Company
Here are amounts you'll need to invest when first buying shares of mutual funds from these top no-load fund companies:
- Vanguard Funds: $3,000
- Fidelity Funds:$2,500
- T. Rowe Price Funds: $2,500
- Charles Schwab Funds:$100
Keep in mind that the above minimums are for the first purchase on most funds offered by the given mutual fund company when the investor is buying in an individual account. Subsequent purchases can be as low as $100 or less. Also, some fund companies accept lower minimums if investing in an IRA or 401(k) plan or when an individual establishes a systematic investment plan.
Therefore, once you make your first purchase, you won't have to come up with hundreds or thousands more before purchasing more shares of the same mutual fund. If you want to gain access to several mutual funds with one purchase, you might consider buying a "fund of funds," which is a mutual fund that invests in other funds.
This can provide diversification and keep you from building more money to meet minimums on great funds from companies like Vanguard and Fidelity.
Mutual fund companies also have some share classes that charge higher initial purchases, such as Vanguard's Admiral Shares, which are usually $10,000 for the initial purchase.
These shares usually have lower expense ratios, which can give a slight performance edge over long holding periods.
Disclaimer: The information on this site is provided for discussion purposes only, and should not be misconstrued as investment advice. Under no circumstances does this information represent a recommendation to buy or sell securities.