Do you currently have $100,000 in the bank that you would like to invest, but not too sure where to start? The key thing to remember is that leaving the money in the bank is going to earn you very little interest. In fact, with most major banks now paying less than 1% per year in interest, you’d actually be losing money if you take inflation in to account.
Alternatively, by making some really smart investments, you can grow your money a lot faster.
Here we present to you 15 smart ways to invest $100,000 in 2019. We’ll explain how each investment works, how much you’re likely to make, and how you can make an investment today.
5 things to remember before investing your $100,000
$100,000 is a significant amount of money. While we appreciate that you want to increase your money by making smart investments, you still need to understand the underlying risks. Before you part with your $100,000, make sure that you take note of the following.
1. How long can you afford to keep your $100,000 tied-up?
When you have your money tied-up in an investment, you won't be able to touch it. As such, you need to ask yourself how long you are willing to wait before you start seeing growth. If you want to invest long-term, then consider assets such as real estate or bonds. Alternatively, if you only want to invest for a short amount of time, then you're probably best suited for peer-to-peer lending or forex trading.
2. What is your appetite for risk?
Regardless of what investment you decide to choose, there will always be an element of risk involved. In a nutshell, the higher the expected returns, the higher the underlying risk. If you want to minimize your risk as much as possible, stick with low-risk investments like U.S. Treasuries or property. If you want to add some higher-risk assets to your portfolio, then consider peer-to-peer lending.
3. How much money would you be happy to walk away with?
It is important that you make some short and long term targets before you invest your $100,000. Are you looking to make a bit of money on the side, or are you looking for annual gains of at least 10%? You need to set some realistic goals along the way, so that you can cash out your investment at the right time.
4. How much experience and knowledge do you have in investing?
$100,000 is a huge amount to invest, so you don't want to be investing in assets or markets that you don't understand. If you're a highly experienced investor - then great. However, if you have virtually no knowledge of the investment space, then you're best off allowing somebody else to manage your money for you. If this is the case, think about investing in bond funds or mutual funds.
5. Do you understand that markets are cyclical?
You need to understand that most markets are cyclical. This means that every now and then, the markets will go through a slump and lose value. This is especially true in the stocks and shares space. Certain real estate markets are also prone to frequent drips. Before you invest your $100,000, make sure that you are emotionally ready for the highs and lows of the investment sphere.