If you’ve got $50,000 burning a hole in your pocket right now, investing it seems to be the right choice to make.
When you have that much cash available, how you proceed depends on your situation. Are you wealth-building, saving for retirement, or trying to get out of debt?
It also helps to diversify your portfolio to reduce your overall risk of market movements. The goal is to create enough stability where gains in one industry can offset losses in another.
Here are some of the best options available right now for that $50k.
If you need some liquidity, consider putting the money in a money market account. You’ll have access to it for stocks, bonds, or mutual funds while restricting its use for everyday expenses. Look for the best interest rates in your community to maximize potential gains.
Mutual funds receive professional money management to allocate assets in ways that produce income or capital gains. You’ll pay some fees for the privilege of earning, but it could be a practical and simplified way to help your money grow. Consider Vanguard, Charles Schwab, or iShares because of their successful history.
3. Real Estate
If you can find a rental property for $50k or less, you can generate some income while taking advantage of the equity gains of the land and improvements. Although you may have expenses to manage during this process (not to mention tenant relationships), it’s a practical way to build wealth.
If you have credit cards with rotating balances on them, use the $50k to pay them off first. You’re spending more than you’re probably making with the interest rates on those lending products. Whatever you have left should go into another investment vehicle.
Most people need a $1,000 emergency fund that they can spend without a second thought. Your secondary savings should cover up to six months of essential expenses. If you don’t have these assets yet, use the $50k to establish them. You’ll reduce the risk of needing to sell future investments with the extra liquidity.
You can do a lot with $50,000 at your disposal. Consider these options today to begin growing your cash tomorrow!