Free money? Sign me up! Sounds too good to be true, huh? Well, it’s not with a bit of smart investing. Even if your pocketbook only holds a few extra dollars each month, investing in stock is still possible. Thanks to the Internet, there are amazing resource available to help you know exactly where to put your money. The most exciting news: these resources are cheap and sometimes free!

Discount Brokers

The best place to start is by signing up with discount brokerage services that don't charge an arm and a leg to trade stocks. Here are some of my favorites:

  • Sharebuilder: Automated stock trades, which you schedule in advance, cost just $4. You can opt to invest once a week, once a month, or whenever you happen to have a small pile of cash saved up. Best of all, Sharebuilder allows you to buy fractional shares so you needn't worry if you have only $40 on hand to purchase a $50/share stock.
  • TradeKing: This site offers stock trades at just $5. Plus, you gain access to its Trader Network where you can research stocks and obtain investment information from other community members.
  • Betterment: If you're not sure which stocks to buy, Betterment's "set-and-forget" purchase model may work for you. With Betterment, you select your risk tolerance and choose from a portfolio of   stocks and bonds. In essence, you buy into an Exchange Traded Fund, much like a mutual fund but more flexible and liquid, without the requirement of $10,000 or more to invest.

Research Help

Now that you know which brokers to use, what about which stocks to buy? Good news! Researching can also be done on the cheap if you know where to look.

  • Check out The Motley Fool. This site has been offering investment advice since 1993, and while some of its services are offered through paid subscription, many other services–including the website and blog–are completely free.
  • Sign up for a free, yes free, subscription from The Wall Street Journal. Sites like Hey It's Free and Hunt4Freebies provide information on how you can score a free subscription to this information-packed journal.

Growth or Dividends?

Now that you have an investment account and some investment ideas lined up, should you invest in growth or dividend-paying stocks? Keep in mind that, although growth stocks can increase your net worth considerably, that growth can also stop or even reverse. On the other hand, dividend-paying stocks may not grow as quickly, but they are generally more stable. Plus, you get a dividend payout every month or quarter, which means a guaranteed passive income for spending or future investment. Some dividend-paying stocks, such as real estate investment trusts or REITs, pay quite well, providing investors with 10% or more per year in dividend income alone.

No extra money to invest at the end of the month? Try implementing the following five financial fixes to get your finances back on track. Also, consider making some money on the side, such as by becoming a blog contributor for the Krazy Coupon Lady.

Use your money wisely and let it work for you! Give investing a try and see the magic in stocks, even in small doses!

This is a guest post by Halina from Madison, WI
Find out more about the KCL Contributor Network!

Watch That Money Grow: Easy Ways to Invest on The Cheap