Received a large sum of money? Or perhaps, saved a lot so much that you're now considering how to grow them further? Here's a clue—investing your money wisely will not only secure your financial future but also build up your wealth.
However, there are now multiple investment options available. Which will secure you a future with minimal risks and high returns? Here are the top 5 best places to invest your money.
High-Yield Savings Accounts/CDs
No one wants to save money in a high-risk environment, and for that, the most beginner-friendly investment option is through high-yield savings accounts and certificates of deposit or CDs. They don't give maximized returns, but you take a little risk with a guarantee because they pay out higher than a typical savings account. As for CDs, this type of investment will lock money into an investment for a period of time. The longer the CD, the better the interest it will yield for giving limited access to funds.
These options are best suited for short-term savings goals or emergency funds without the risk of market fluctuations.
Stock Market
Now, if you're getting bolder with risks, perhaps, one of the most popular places to invest in is the stock market. Investopedia shared that it offers a high potential for returns over time. In fact, those who had their money in the stock market gain from price appreciation, dividends, and ownership in successful businesses by purchasing shares of publicly traded companies.
However, take note that this is volatile in the short term since the stock market can often fluctuate, but the long-term growth potential is there.
Real Estate
If you don't want your money to sit somewhere static, waiting for the market to decide for you, investing in real estate is another excellent way to amass wealth over time. Real estate is one of the best investments that offer higher and steady cash flow, which is often possible through rental income. Some might even say it's a passive income you can generate while sitting at home. All besides the possibility of appreciation in the value of property, which is now getting higher, per VCPost.
Some popular options include residential properties and commercial properties.
Mutual Funds / ETFs
Assuming that you're now looking for high and steady returns while the market is booming, then you're ready to invest your money in mutual funds or exchange-traded funds. From these two, you get to put your money to circular in different bonds, stocks, and other such assets without choosing them one by one.
To better explain, in mutual funds, experts choose which assets to include, while in ETFs, the tracking of a specific index is automatically done. The only difference is mutual funds is equal to higher investments because there's a professional involved. However, both options help spread out your investment, thereby reducing the risk and making it easier for beginners or those who prefer a simpler approach to investing, Fidelity Investments reported.
Take note that finding the best place to invest money, there is no one solid rule. However, the best investment strategy would depend on your financial goals, the risks you want to take, and time. If unsure of the environment and there's extra money to spare, then consulting a financial advisor is in order. The best advice, however, is to stay patient to watch your investments grow over time.
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