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Most people think you need to be rich to start investing. But what if I told you that skipping your daily Starbucks or resisting the urge to buy another Fortnite skin could actually make you a millionaire?
I’ve shared this idea before: if you invest just $5 a day with an average 10% annual return, in 45 years, you’d have nearly $1.6 million. That fact alone is enough to get anyone thinking. But of course, not everyone is convinced.
I always get the same hate comments:
- “I want to enjoy my money now, not save it.”
- “I don’t want to be a millionaire when I’m 65—I want it now.”
- “Where on earth can you get a 10% return for that long?”
So instead of arguing back, I decided to prove it. I kicked off a $5-a-day investing challenge and tracked it for an entire year. Here’s exactly how I did it, the platforms and strategies I used, and—most importantly—the real results after 12 months.
Step 1: Finding the Right Investing Platform
To take this challenge seriously, I needed a reliable, low-fee platform. Here were my non-negotiables:
- Low fees (no point investing if fees eat all your profits)
- Beginner-friendly interface
- Security (I wanted protection up to £85,000 in case of platform failure)
- Low minimum deposits
- Automatic investing features
- Access to fractional shares
After testing several platforms, I landed on Trading 212. It checked all the boxes and made the whole process surprisingly simple.
Step 2: Opening the Right Kind of Account
Here’s a mistake most beginners make: opening a general investing account without thinking about taxes.
Let me break it down.
Imagine you have two accounts:
- Account A: A regular investing account
- Account B: A tax-advantaged account (like a Stocks & Shares ISA in the UK or Roth IRA in the US)
Put $1,000 in each and grow them the same way. But with Account A, the taxman takes his share of your dividends and capital gains. With Account B, you keep everything. No tax. No nonsense.
So for this challenge, I went with Account B. In my case, that meant opening a Stocks & Shares ISA through Trading 212.
Step 3: Picking the Right Investments
Now for the fun part: deciding what to invest in.
Sure, I could go with individual stocks like Apple or Tesla. But let’s be honest—putting all your money into a few companies is risky. That’s why I chose a smarter, safer path: index fund investing.
Specifically, I invested in the Vanguard S&P 500 Accumulation fund. This fund gives me exposure to 500 of the top U.S. companies, automatically reinvests dividends, and helps spread my risk across hundreds of businesses.
Plus, this fund fits perfectly inside my tax-advantaged ISA, meaning my returns are tax-free.
Step 4: Setting Up Auto-Investing
Investing $5 every single day? Yeah, I’d forget within a week.
That’s why I set up auto-investing on Trading 212. It automates everything:
- It pulls £5 from my bank every day.
- It buys more of my S&P 500 fund—whether the market’s up or down.
- It uses dollar-cost averaging to reduce risk over time.
This approach removes emotions and avoids the trap of trying to time the market. And trust me, that’s a trap.
When the market is down? I get more shares for my money.
When the market is up? I still invest, but I buy less.
Over time, these ups and downs average out—and that’s where the compound magic kicks in.
What Happened After One Year?
Let’s talk results.
I kicked off the challenge in August 2023 with daily £5 investments.
- Month 1: Up £2.37 — a 1.5% return
- Month 2: Down £0.79 — a small -0.5% loss
At this point, most people quit. They don’t see results fast enough and assume it’s not worth it.
But I stuck with it.
By 6 months in, I was up £83.70 (18.2% return).
By 12 months, I had made £161.34 in profit—an 18.1% return on my £1,344 investment.
Not bad for skipping coffee and letting an app do all the work.
But here’s where it gets wild.
After continuing the challenge for a little longer (past the one-year mark), here’s where I ended up:
- Total invested: £1,505
- Portfolio value: £1,972
- Total profit: £467.03
- Return: 43.8% 💥
That’s $576.59 in profit—just by investing five bucks a day and forgetting about it.
What Did I Learn?
This challenge proved a few big things:
- Time in the market beats timing the market
- If I had panicked after a losing month and stopped, I’d have missed out on huge gains.
- Automation is everything
- Once I set it up, I didn’t have to touch it. I literally forgot about it for months.
- Consistency works
- Investing small amounts consistently beats trying to find the “perfect time” to invest.
Can You Do This Too?
Absolutely.
Here’s what you need:
- A platform with low fees and fractional shares
- A tax-advantaged account if it’s available in your country
- A reliable index fund (like the S&P 500)
- Auto-investing setup for $5 (or whatever you can afford) a day
This approach isn’t about getting rich overnight. It’s about building long-term wealth without stress or overwhelm.
If you’re interested in learning how I choose my investments or want to follow the challenge for longer, I’ll be posting updates—so stay tuned.
Until then, skip that latte, invest a fiver, and let compound interest do the rest.