Investing from scratch

If a lack of cash has kept you out of the market, here are three low-cost ways to get in

set up accounts with Lucent Technologies and a number of other corporations. When he got married four years ago, he enrolled his wife in Intel’s direct purchase program.

You might be asking yourself.’ so with hundreds of companies to choose from, what are a few direct purchase plans that look good for the long haul? We asked Joseph Tigue, managing editor of Outlook, an investment advisory newsletter published by Standard & Poor’s, for a portfolio of five solid companies with DSPs. His suggestion, along with contact numbers for applications and information: entertainment giant Disney (NYSE: DIS) (800-9482222); Exxon (NYSE: XON) (800-252-1800); General Electric (NYSE: GE) (800-7862543); Lucent Technologies (NYSE: LU) (888-582-3686) and a Southeast bank, Regions Financial (Nasdaq: RGBK) (800-524-2879).

There are dozens of others to choose from and a number of ways to find out whether a stock that has piqued your interest offers a direct purchase program. One way, albeit hit-or- miss, is to call a corporation’s investor relations department. We’d suggest you check into two resources. First off, on the Internet, Quicken (www.quicken.com), the personal finance software maker, has a web page devoted to DRPs and DSPs. Another good resource is the Directory of Dividend Reinvestment Plans ($39.95), published by Standard & Poor’s.

A FOOTHOLD IN FUNDS
Mutual funds offer programs that are quite similar to direct investment plans. Automatic investment plans, as they are often called, require a minimum initial investment as long as you agree to have a set amount withdrawn from your checking or savings account. Just ask Robert Crenshaw Jr., 46, of Walnut, California. A salesman for a company that makes dialysis machines and supplies, Crenshaw got the investment itch back in 1981. He signed up with the Janus Venture Fund, agreeing to have $100 a month tapped from his checking account. Whenever he got a raise at work, he increased the amount, eventually bringing on two additional funds, the Invesco Industrial and American Century’s Ultra Fund. He’s stuck to it, funneling a steady $100 a month to each fund. The result: Crenshaw has over $60,000 stashed away in the three funds and by reading up on prospectuses and annual reports, he’s becoming something of an investment w
hiz in his own right. “I started off slowly, but this was a great way to pick up on the market over time,” he says.

Choices? There are literally thousands of equity funds that offer a low minimum initial investment to open up an automatic withdrawal plan. If you can start with $500 and agree to a regular sum invested monthly, there are 3,330 funds to accommodate you, according to Morningstar, the Chicago firm that tracks mutual funds. At an opening investment of $250, there are 3,067 funds; at $100 the list is still some 2,763; $50 narrows the list to 2,048; and no money down still gets you a selection of 100 funds altogether. That’s compared with the usual minimum initial investment of $1,000 to $2,500 many retail funds require.

A quick note to help keep things clear: many funds

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