{"id":21631,"date":"2024-02-09T17:30:08","date_gmt":"2024-02-09T17:30:08","guid":{"rendered":"https:\/\/www.webmonkey.com\/how-to-invest-40k-10-realistic-methods-to-try\/"},"modified":"2024-07-24T15:48:36","modified_gmt":"2024-07-24T15:48:36","slug":"how-to-invest-40k","status":"publish","type":"post","link":"https:\/\/www.webmonkey.com\/how-to-invest-40k\/","title":{"rendered":"How To Invest 40k – 10 Realistic Methods To Try"},"content":{"rendered":"
So, you have $40,000 in extra cash and you're wondering how to put your money to work<\/a>.<\/p>\n The great news is there are many ways to invest 40k that you can use to start building wealth. Some of these methods are more passive than others, and some carry different risk-versus-reward ratios than others.<\/p>\n But at the end of the day, investing beats hidings money under your mattress! So, let's dive into how to invest 40k so you can make your money work for you!<\/p>\n Before we jump into what to do with 40k, it's important to determine a few things about your investing style<\/strong>:<\/p>\n Also note that you should speak to a financial advisor or investing professional if you have questions. I am not a financial advisor, and you should always do your own research and due diligence when making financial decisions.<\/p>\n Alright, let's move onto how to invest $40,000!<\/p>\n One of the most straightforward ways to invest 40,000 dollars is to invest in stocks and exchange-traded funds (ETFs.)<\/strong><\/p>\n Stocks let you own a part of a company. And ETFs are funds that often contain numerous stocks or other securities to provide investors with more diversification.<\/p>\n You can even invest in things like dividend stocks that pay you quarterly or annual dividends from company profits. And the great news is investing in stocks or ETFs is easy these days<\/strong>.<\/p>\n You can likely start investing without paying commissions through your bank. And there are plenty of commission-free brokers out there that you can try as well.<\/p>\n If you need a helping hand on where to start, you can always speak to a financial advisor at your bank. There's also a wealth of information online about how to research stocks.<\/p>\n Services like The Motley Fool<\/a><\/strong> are also excellent stock advisory services that provide monthly stock picks to help you build your portfolio.<\/p>\n <\/p>\n Overall, you have\u00a0so\u00a0<\/em>many options for starting out with stocks and ETFs, and there's so much valuable information online about the subject.<\/p>\n \ud83d\udc49\u00a0The Best Income Generating Assets To Buy<\/strong><\/a>.<\/p>\n If you want to invest 40k in real estate, you actually have plenty of options.<\/p>\n This surprises many investors since traditionally, you needed a lot of capital to get involved with real estate.<\/p>\n However, thanks to the rise of real estate investing platforms, you can add income-generating real estate to your portfolio with small amounts of capital.<\/p>\n For example, Fundrise<\/a>\u00a0<\/strong>lets you invest in real estate projects starting with just $10. So it's a beginner-friendly way to add real estate to your portfolio.<\/p>\n <\/strong>Investments generally include multi family homes, office buildings, and other commercial real estate developments. You get paid quarterly dividends, and you can also earn from your shares appreciating.<\/p>\n Fundrise returns around 8% to 11% annually on average, and you pay a 1% management fee per year<\/strong>.<\/p>\n If you want to invest and make money daily<\/a>, it's a great option thanks to the dividend payment structure. There are numerous other real estate investing companies out there too, like RealtyMogul<\/a> and Arrived<\/a>.<\/p>\n Both platforms also have excellent commercial real estate opportunities, although you need $5,000 to start investing.<\/p>\n But the bottom line is you can invest $40,000 in real estate or even much less thanks to these new investing platforms.<\/p>\n Learn more about investing with Fundrise!<\/a><\/strong><\/p>\n Disclaimer: This is an endorsement in partnership with Fundrise. We earn a commission from partner links. All opinions are my own.<\/em><\/p>\n If you want to make money on autopilot<\/a>, it's hard to beat investing with a robo-advisor.<\/p>\n Robo-advisors use algorithms to pick investments that match your goals and level of risk tolerance.<\/p>\n It's basically like working with a financial advisor, except the fees are generally much lower and you don't need much money to start.<\/p>\n One popular robo-advisor and way to invest 40k is\u00a0Betterment<\/a><\/strong>.<\/p>\n <\/strong>This leading robo-advisor asks you a questionnaire about your investing goals and style when you sign up.<\/p>\n From there, you can invest in different Betterment portfolios which are largely comprised of ETFs and bonds.<\/p>\n What's cool about Betterment is that there are plenty of portfolios to choose from, including options like<\/strong>:<\/p>\n Betterment charges 0.25% annually for portfolios under $100,000, which is only $100 in fees per year if you invest $40,000.<\/p>\n You also get features like automatic portfolio rebalancing and tax-loss harvesting, so it's an excellent all-around robo-advisor you can try.<\/p>\n For a more exciting way to invest 40k, you can explore various alternative investment options.<\/p>\n Alternative investments can include anything from farmland to fine wine. And some investors use these sorts of non-traditional investments to diversify their portfolios and potentially outperform the market.<\/p>\n Thankfully, you don't need to find these alternative investment opportunities yourself either.<\/p>\n Companies like Yieldstreet<\/a><\/strong> specialize in alternative investments, and its entry-level Prism Fund only requires $500 to get started.<\/p>\n Some of the alternative asset classes you can invest in with Yieldstreet include<\/strong>:<\/p>\n Different funds have different investing minimums, and some require $10,000 to $15,000 to get started.<\/p>\n But you can always invest 40k or less into one or two funds to add some variety to your portfolio.<\/p>\n Companies like Alto IRA<\/a><\/strong> also let you invest in numerous alternative investments, just in your IRA.<\/p>\n Between these two companies, there are plenty of ways to add different asset classes. And you can invest $40,000 or even less if you just want to dabble with this type of investing.<\/p>\n Learn more about Yieldstreet!<\/strong><\/a><\/p>\n Fixed-income investments provide a steady stream of income for more stability and less risk.<\/p>\n Some investors use fixed-income investments if they're investing for the short-term. This is because the low volatility reduces the risk they lose money when they need it for an upcoming expense.<\/p>\n Examples of popular fixed-income investments include<\/strong>:<\/p>\n The main downside of investing $40,000 this way is that your returns are generally quite low; think 0.50% to 1.5% at most.<\/p>\n And during periods of high inflation, these sorts of returns aren't doing you much good.<\/p>\n That said, you can always invest a portion of your 40k nest egg in fixed-income investments for less risk and some predictable returns.<\/p>\n Digital assets like crypto and NFTs have been the hottest investing trend for the last few years.<\/p>\n And while crypto markets have been hurting in early 2022, you can still consider crypto as a way to invest $40,000.<\/p>\n Exchanges like Coinbase<\/strong><\/a> make getting started easy, and you can invest in 150+ cryptos starting with just $2.<\/p>\n <\/strong>Coinbase also supports plenty of popular coins like<\/strong>:<\/p>\n You can also stake certain cryptos to earn up to 5% APY. If you want to earn passive income<\/a>, this sort of feature is what you want in an exchange.<\/p>\nThe Best Ways To Invest 40K<\/strong><\/h2>\n
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1. Stocks & ETFs<\/strong><\/h3>\n
2. Real Estate<\/strong><\/h3>\n
3. Use A Robo-Advisor<\/strong><\/h3>\n
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4. Alternative Investments<\/strong><\/h3>\n
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5. Fixed-Income Investments<\/strong><\/h3>\n
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6. Cryptocurrency<\/strong><\/h3>\n
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