Updated: June 2024
When I met my wife to be back in 2016, I made a decision to turn around my personal finances before we got married. I had decent-paying jobs up until that point, but couldn’t seem to get ahead.
I was living paycheck to paycheck, didn’t have any savings, and was severely in debt.
I started researching ways to improve my finances. One of the tips I heard countless times was to invest and grow your money.
I had heard this before when I was growing up but it wasn’t until I started doing it myself that I truly understood the idea of making your money work for you.
Now, 8 years later, I am debt-free, have several savings and investment accounts, and multiple other investments.
With that in mind, here are the best ways to Invest money for profit in 2024.
What are the best ways to invest money for profit?
- Individual Stocks
- Index Funds
- ETFs
- Bonds
- Real Estate
- R.E.I.T.s (Real Estate Investment Trusts)
- C.D. (Certificates of Deposit)
- High Yield Savings Account
- Gold and Silver Bullion
- Cryptocurrency
- Advertising
Disclaimer
Remember that I’m not a licensed investment or financial professional. The information in this article is for educational purposes only and is not to be treated as professional advice. I’m not responsible for any gains or losses that you incur due to the financial choices that you make.
Every type of investment has some type of risk, so keep that in mind before putting your money into something.
1. Individual Stocks
When getting into the stock market, I believe one of the best ways to invest for profit is to buy individual stocks of companies that you understand, believe in, and support as a consumer.
On the flip side of that, I believe that investing in companies that you don’t understand is probably not a wise move.
Some of the companies that I invest in are Costco, Walmart, Kroger, American Express, and T-Mobile.
I personally use these businesses in my daily life and believe in their sustainability in the long term. Not only that, but these businesses also pay dividends.
If you’re not familiar, Dividends are profits from the business that get paid back to shareholders.
To get started investing, I recommend checking out SoFi Bank. If you use my referral link, you’ll get $25 worth of your favorite stock when you fund a SoFi Active Invest account with $10 or more.
2. Index Funds
The next type of investment that I put my money into is index funds. Index funds are a group of individual stocks clumped together as one stock. Most of my stock market Investments are in the form of index funds and ETFs (more on those next).
The reason why I invest so much of my money into these is because they have very low risk. Because index funds are a combination of several companies and bonds, they are much more diversified.
This means that if one of the companies in the fund lowers in value, the rest of the fund can offset those losses.
Here are a few of the index funds that I have in my portfolio:
- FXAIX (Fidelity 500 Index Fund)
- VTI (Vanguard Total Stock Market Index Fund)
3. ETFs (Exchange-traded fund)
ETFs or Exchange-traded funds, are very similar to index funds. The 4 main benefits of ETFs, according to Fidelity, are trading flexibility, portfolio diversification and risk management, lower costs, and tax benefits.
I like ETFs because they generally are much less expensive to invest in than traditional Index funds, meaning they are a better option for individuals on a lower income.
Here are a few of the ETFs that I have in my portfolio:
- VOO (Vanguard 500 Index Fund CL ETF)
- VGT (Vanguard Information Technology ETF)
- VIG (Vanguard Dividend Appreciation ETF)
4. Bonds
According to Investopedia, a government Bond is a debt security that helps support the government.
While government Bonds are much lower risk than stocks and other market investments, they are also much lower-performing investments.
About 10% of my total stock market Investments are in government bonds, so I do believe there are benefits to having it because they diversify your portfolio.
I like to invest in government bond ETFs as they are generally even lower risk than buying bonds themselves.
Here are a few of the Government Bond ETFs that I invest in:
- AGG (IShares Core US Aggregate Bond ETF)
- GOVT (iShares U.S. Treasury Bond ETF)
5. Real Estate
Real estate investing can be an amazing way to invest your money and gain profit.
There are many types of real estate investments that you can put your money into, and each one is going to have many different factors that depend on your personal situation.
For example, purchasing a single-family is a common way that many people invest in real estate. generally, they will purchase a home and live their normal lives.
As the years go on, the home should increase in value. If the homeowners decide to sell their home, they will likely make a profit on that investment.
Another scenario is by purchasing a multi-family property. This can include duplexes, triplexes, or even entire apartment buildings.
The investor can live in one property and rent out the others to tenants. If you can get a property at the right price and in the right market, you can essentially have your tenants pay your entire mortgage.
While real estate investing can be a great opportunity in the right market and for those who have enough capital, there are some downsides.
Properties will almost always need some type of repairs and maintenance. A new refrigerator, washer/ dryer, or roof is a lot more expensive than you might think.
Then there is the issue of dealing with tenants if you rent out your property. You’ll have to do background checks and credit checks even before you get your first tenant in the home.
There can also be a lot of drama when dealing with people and their living situations. From what I’ve heard speaking to landlords, it can sometimes be more stressful than what it’s worth.
Tenants can vandalize the home, stop paying the rent, or constantly call about maintenance for repairs that they likely caused.
Many finance gurus claim that real estate investing is passive income, but when you’re dealing with all of these types of issues, it’s clearly not.
6. R.E.I.T.s (Real Estate Investment Trusts)
If you’re interested in getting into real estate investing without the headaches associated with owning your own properties, Real Estate Investment Trusts, or R.E.I.T.s for short, Could be the right opportunity for you.
R.E.I.T.s are companies that own and manage large groups of commercial and residential real estate properties.
The benefit to R.E.I.T.s is that they are the ones managing the properties, collecting payments, and dealing with the stress associated with tenants.
By investing in certain R.E.I.T.s on the stock market, almost all of these trusts pay a dividend.
Many even pay a monthly dividend, so your initial investment can turn into a cash-flowing asset in a short amount of time.
In my opinion, it is one of the most passive forms of investing in the world. However, R.E.I.T.s can be a bit more volatile than some other investments.
I think it is good to have them in a well-diversified portfolio though.
Here are a few of the R.E.I.T.s that I invest in:
- O (Realty Income)
- KIM (Kimco Realty
- SPG (Simon Property Group Inc.)
7. CD (Certificates of Deposit)
A CD or certificate of deposit, is a type of savings account that credit unions and banks offer their clients.
By keeping your investment in the CD without withdrawing your money, the bank will pay you a return on that investment.
Many online banks such as Ally offer CDs, but you can also check with your local bank or credit union to see what types of rates they offer.
8. High Yield Savings Account
Another great way to invest your money for profit is to put it into a high-yield savings account.
Recently, I pulled all of my money out of my local credit union savings account because they were paying me less than 1% interest per year on my money.
I then moved it to SoFi Bank, who at the time of writing this article, is paying 4.25% interest per year on their high yield online savings.
You can also withdraw your money at any time as opposed to a CD. There are not too many downsides to putting money into a high-yield savings account other than you could make more money in the stock market.
If you sign up with my referral link for SoFi’s Checking and Savings Accounts, SoFi will give you $50 to $300 when you sign up for direct deposit.
9. Gold and Silver Bullion
I began gold and silver investing a few years ago and haven’t looked back.
Maybe it is because as a kid I always enjoyed watching DuckTales and seeing Scrooge McDuck dive into a vault filled with gold coins.
There are many benefits to investing in gold and silver. The first main reason why I invest in gold and silver is because it helps fight inflation.
As the U.S. dollar decreases in value every year due to inflation, gold and silver have historically risen in value.
Here’s a great example of that. Let’s say you bought an ounce of gold in 1970 at its value of $38.90.
- 1 Oz price of Gold in 1970: $38.90
- Average price of a Gallon of Gasoline in 1970: $0.36
You could buy 108 gallons of fuel with that 1 Oz of gold in 1970. Now let’s say you held on to that 1 Oz of gold for 50 years.
- 1 Oz price of Gold in 2020: $1773.73
- Average price of a Gallon of Gasoline in 2020: $3.15
With that same amount of Gold, you could now buy 563 gallons of gasoline in 2020.
That’s about a 500% increase in your value per dollar.
If you think that gold and silver is just for jewelry and coins, you’d be mistaken. Gold and silver are used in electronics, machinery, space travel vehicles, solar panels, and numerous other applications.
I enjoy finding different Gold and silver coins when I travel. It’s a fun way to experience the culture and build wealth at the same time.
If you want to find out a bit more, check out my other article on how to invest in gold and silver bullion here.
10. Cryptocurrency
While I’ve only experimented a bit with cryptocurrency in my investments, I still believe that there is a place for them, even on a smaller scale.
Some investors have literally made millions of dollars by investing in cryptocurrency. So the potential is there.
However, these types of Investments are so new that I can’t in good faith give an accurate opinion on the matter.
Like any investment, do your research for putting your money into anything.
11. Advertising
This type of investment is more for a business owner. By investing in advertising, you can potentially get more people to your business, and in turn, create more income. This is how investing into advertising can make you profits.
For example, if I invest in an ad that brings new readers to this website for $100, and make a $500 affilate commission from one of those new readers, I just made a 400% profit on my money.
Like all other Investments, there’s no guarantee that you will make your money back if you invest in advertising. However, entrepreneurs have had success with profiting from advertising for decades.
The most popular ads you can run are either through Google or Facebook, but many other platforms now allow you to put ads on their site. Learn from my mistake and only use ads when your business is making a profit or has the budget for it.
Final Thoughts On Investing For Profit
There are many types of investments that you can find that have the potential to earn you profit.
However, these are the ones that I have dipped my feet into and can recommend:
- Individual Stocks
- Index Funds
- ETFs
- Bonds
- Real Estate
- R.E.I.T.s (Real Estate Investment Trusts)
- C.D. (Certificates of Deposit)
- High Yield Savings Account
- Gold and Silver Bullion
- Cryptocurrency
- Advertising
If you’re thinking about how to start building wealth through investments, you deserve a pat on the back. Not many people are thinking of any type of investing, so that’s a sign that you’re heading in the right direction.
Just remember to do your research, be consistent, and not beat up on yourself when you face inevitable setbacks. Two steps forward and one step backward is still moving in the right direction.
Thanks for reading,
Nick Hazleton