If you're just starting out with investing, you may not have tens of thousands of dollars to invest into the share market.
But I wouldn't let that put you off starting your investment journey. This is because even small investments can grow into something meaningful over a long enough timeframe thanks to compounding.
Even if you can only afford to invest $500 into the share market every quarter, it has the potential to grow into something material in the future.
For example, if you invested $500 in the share market each quarter ($2,000 per year) and earned a 10% return annually, your investments would be worth over $360,000 after 30 years.
And if you're able to increase your investments as the years go by, you could grow your wealth even more.
But which shares should you start with? I believe thinking long term would be the best thing to do and the three shares listed below could be great options. Here's why I would invest $500 into them:
Megaport Ltd (ASX: MP1)
The first share to consider investing $500 into is Megaport. It is an elasticity connectivity and network services company. Megaport's service allows businesses to increase and decrease their available bandwidth in response to their own demand requirements. This has proven very popular with businesses that don't want to be tied to a fixed service level on long-term and expensive contracts. Demand for its service has been growing very strongly, leading to stellar recurring revenue growth. Given the accelerating shift to the cloud, I believe it is well-placed to continue its positive form for the foreseeable future.
Nearmap Ltd (ASX: NEA)
Another top ASX share to consider investing $500 into is Nearmap. It is one of the leading aerial imagery technology and location data companies. At present the company has operations in the ANZ and North American markets and is generating sizeable recurring revenues from both regions. Looking ahead, I remain very confident in its long term growth prospects. This is due to its high quality offering and its strong position in a fragmented market worth an estimated $2.9 billion per year.
Pushpay Holdings Group Ltd (ASX: PPH)
A final option for the $500 investment is Pushpay. It is a fast-growing donor management platform provider in the faith and not-for-profit sectors. While this is a niche market, it is a very lucrative one. In FY 2020 the company delivered a 39% increase in total processing volume to US$5 billion and a 33% increase in operating revenue to US$127.5 million. Pleasingly, this strong growth is expected to continue in FY 2021, with management forecasting its operating earnings to double.
