🪙 Make Your Own Machine Part 11: What If I Don’t Have Enough for 100 Shares?
(How to Use Cash-Secured Puts to Build In Like a Boss)
So maybe you’re following the FIRE Engine strategy, but you’ve hit a wall:
“I don’t have enough for 100 shares yet… Can I still play the game?”
Short answer: Yes.
Longer answer: You can get paid while you save up — and maybe even get the stock at a discount.
Let me introduce you to the cash-secured put — a covered call’s sneaky cousin.
🤔 What’s a Cash-Secured Put?
It’s a fancy way of saying:
“I’ll agree to maybe buy this stock at a lower price, but you have to pay me upfront just for being willing.”
You’re not buying anything yet. You’re getting paid to wait.
Here’s what it looks like:
- You don’t own the stock (yet)
- You want to own it — but only at a cheaper price
- You sell a put option that says:
“If the stock drops to $7, I’ll buy it — but pay me now for the privilege.”
🧮 Real Example (Clean Numbers)
Let’s say:
- RUM is trading at $7.50
- You want it at $7.00
- You sell a $7 put that expires next Friday
- Someone pays you $15 premium for it
Two outcomes:
| Scenario | What Happens |
|---|---|
| RUM stays above $7 | You keep the $15, no shares bought |
| RUM drops below $7 | You buy 100 shares at $7 = $700, but still keep the $15 |
Either way, you get paid.
And if you get assigned? Great — you just bought your stock on sale and already earned premium on day one.
đź’Ľ Why This Is Great for Beginners
- You don’t need to guess the bottom — just pick a price you’d be happy with
- You get paid to wait — better than setting a limit order for free
- You build your FIRE Engine from the ground up — one secured put at a time
And once you get assigned your first 100 shares?
You flip the strategy and start selling covered calls.
Congrats — you’re now running the full loop.
⚠️ What You Need to Know First
- You need the full cash amount on hand (hence cash-secured)
- $7 x 100 shares = $700 required
- You must be okay buying the stock at that price
- You’re still on the hook if the stock crashes — so choose wisely
But if you pick a company like RUM that you believe in, and the price is fair?
It’s a smart way to get started while getting paid.
🧠Bottom Line
Cash-secured puts let you earn income before you own the stock.
It’s how beginners can build a position without chasing prices or sitting on the sidelines.
In the next post, we’ll talk about what happens when you finally hit your first big goal — stacking up those 200 shares — and what it unlocks.
👉 Up Next: [Post 12: You Hit 200 Shares — Now What? Scaling the FIRE Engine]
Still stacking? Watch me do it in real time: Check out the FIRE Engine blog.