Congrats! Having $50k to invest is a great position to be in. But how do you turn it into more money?
If you want to double $50k, you're going to need to do some research so you don't lose a significant amount of cash.
In this post, I'll explore how to double $50k, how long it takes to double your investments, what the returns are on $50,000, and much more. Let's get started.
What to Do Before Investing $50,000
Before investing your money, there are a few things you'll want to be sure to do.
Establish an Emergency Fund
Having an emergency fund is a great way to set yourself up for financial success. Most people and families have trouble saving money for an emergency.
How much should you save?
Many personal finance experts recommend saving around 6 months of your normal living expenses. This should include things like your rent or mortgage, utility bills, and other vital expenses.
Pay Off Debt
If you have high-interest debts like a personal loan, credit card debt, or some student loans, it's wise to pay them off before investing your money.
The reasoning is a simple math equation. If your interest rates on your debt average out to 8% annually and your potential returns average out to 8% – you should pay off debt because it is a guaranteed return. Otherwise, any money you make will need to be dedicated to paying off your debts.
11 Best Ways to Double $50k
Below are some of the top ways to double $50k. Be sure to analyze the risk of each investment and always consult a financial advisor before making any investments.
Double $50,000 Investing in Index Funds
One of the most reliable ways to double your money is through the stock market and more specifically, index funds.
Index funds have a track record of delivering strong returns for investors with relatively low risk.
Index funds are a top choice for doubling $50k because of how hands-off it is. You can just purchase some of the top index funds and expect to earn anywhere from 7% to 10% annually on average.
While this return might not sound like much, it will compound over time.
To invest in index funds, I recommend using a platform like Acorns. Acorns will automatically round up spare change and invest it for you. As a bonus, you'll get $10 completely free with the link below.
Another option is utilizing a retirement account like a 401k or Roth IRA to grow your retirement savings.
Use Fundrise to Double $50k
Fundrise is a crowdfunded real estate platform that can be a great way to double your money.
When it comes to investing in real estate, you might think you need a significant amount of cash to get started – but this isn't always the case.
By using a platform like Fundrise, money is pooled together from many investors to purchase large commercial and multi-family properties that will be rented out. The income is then split up between investors.
This is a great way to gain access to an investment you otherwise wouldn't have access to without having millions to invest.
Another massive benefit of this form of real estate investing is that you won't have to deal with the headache of managing tenants, maintaining properties, or marketing your properties. This is all done by the team for you.
With Fundrise you can invest in real estate with as little as $500. Sign up below to get started!
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Make Passive Income with ETFs
Exchange-traded funds, also known as ETFs, are another great way to invest your money in the stock market while limiting risk.
ETFs are a group of stocks that are packaged together so you can easily invest and diversify your portfolio through a stock exchange.
Invest $50k in REITs
If you want to invest in real estate without the headache that comes with owning rental properties, another option is a real estate investment trust.
REITs are traded on the stock market and are similar to platforms like Fundrise. The main difference is that you can use your traditional brokerage account to purchase a REIT instead of using a third party like Fundrise.
Some REITs can also have a lower initial investment than crowdfunded real estate platforms.
The returns of REITs tend to be slightly lower than other forms of real estate investing, but they also have slightly less risk.
Use Mutual Funds to Double Your Money
Mutual funds are another stock market investment option to double $50k.
Mutual funds are very similar to ETFs and index funds in that they are a large group of stocks packaged together.
When comparing mutual funds to other stock investments like index funds or ETFs, there tends to be one main difference.
Most mutual funds are actively managed. This means that the fund is operated by a group of investment professionals that decide what stocks to include in their fund.
While you might be thinking this will give you an edge over other investments, it will typically come with a cost. Mutual funds have larger management fees compared to index funds or ETFs. These fees can sometimes be offset by stronger performance, but it's never guaranteed.
Ultimately, choosing a mutual fund to invest in can be an easy way to double your money with $50,000.
Double Your Money Blogging
Blogging is one of my favorite ways to make money online and it can easily double your $50k investment.
You might be thinking “Okay, but how do I actually invest $50,000 into a blog or website?”
Well, you have a few options.
You can purchase an existing blog or website that currently makes money, or you can build your own blog.
Depending on your skills, there is no right or wrong answer. If you want a “safer” investment – building your own site is probably the way to go, however, this can take much longer to double your $50,000.
If you want a faster way to double your money, purchasing an existing site and growing it could be a better option.
There are many types of blogs that make money ranging from personal finance to video games. Blogs make money through many methods. The most common are display advertising and affiliate marketing.
The amount of money you can make from an online business or blog is quite limitless. Some bloggers make over 7 figures each month from their sites. Talk about some serious cash!
Flip Houses to Double $50,000
You've probably seen countless home flipping shows on television and wondering if people really do it.
The truth is, yes! People can make very good money from flipping houses.
Flipping homes will require a large amount of cash to get started, but if you have the money available, it can be a very profitable venture.
To flip homes, you'll need to start by purchasing a home below the market value. Typically these homes are distressed and need some remodeling.
Once you acquire the property, you'll need to refurbish it and bring it up to a good condition.
Finally, you'll need to list the property for sale to make money.
Finding and negotiating deals is one of the key parts of flipping houses. If you have trouble with this part, it might be better to invest your money elsewhere.
It's also beneficial to have some woodworking and electrical skills so you can make improvements to the home yourself to save money.
You can also convert your flip into a real estate investment property to double $50,000.
If you want to make more money – obtaining your real estate license can be beneficial to reduce fees when selling.
Every market is different, so be sure to do your research before going all-in with flipping houses. You can check out the video below for more help flipping properties!
Rent Out a Home for Cash Flow
Owning rental properties is another form of real estate investing you can use to double your $50k.
Owning a rental property comes with much more responsibility than the other forms of real estate investment we've discussed.
With this type of investing, you'll need to deal with tenants, find people for your rental property, and deal with the maintenance tasks that arise.
But all of these headaches come with one major benefit.
Real estate investing through rental properties can return over 15% or 20% annually in some areas.
If you have $50k and are looking to build your wealth, owning rental properties can be an excellent form of passive investing.
One major roadblock many people have when deciding to purchase an investment property is the down payment that is required. It's common to need 20% of the property's selling price as a down payment. In some cases, this can amount to over $25,000.
With rental real estate investing your properties can make money through several methods.
Between rent payments, appreciation, and mortgage pay-down – your income can swell with this asset class.
As a bonus, there are tax benefits that come with owning rentals.
Earn Passive Income with Bonds
Investing your money in bonds is one of the safest ways to double your cash.
While your returns will likely be much lower than other investments, this is a good option if you have an extremely low risk tolerance.
There are several types of bonds you can consider. Government bonds, corporate bonds, and municipal bonds are all options when you begin investing.
The amount of money you can make will depend on the type of bond you choose to invest in and the current market interest rates.
If you want to make more money, corporate bonds will have higher yields, but also come with more risk.
If you have an extremely high risk tolerance, cryptocurrency can be one method to double your money.
By investing your money into cryptocurrency like Bitcoin and Etherium you can diversify your assets and potentially make tens of thousands of dollars in just a few months.
But the opposite is also true when it comes to cryptocurrency. You can also lose money fast. It's not uncommon to see swings of greater than 5% or 10% (sometimes ever 25%) throughout the day with crypto.
If you have extra cash to invest, I would recommend putting a small portion of it into a different asset class like crypto to optimize your returns.
Not sure how to get started?
I recommend Coinbase to invest in crypto. With millions of users, it's a trusted way to buy and sell the most popular cryptocurrencies. Register below to get started.
Invest Safely with a High Yield Savings Account
Another safe way to double $50k is through a high yield savings account.
While traditional savings accounts will pay interest rates less than .1%, many high yield savings accounts will pay 10 times that amount.
The interest rate that is paid will depend on current market conditions but it's a great way to store your money.
My favorite account is through CIT Bank. You can create your account below to start growing your money in no time!
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How Long Does it Take to Double $50k?
Doubling $50k can take some time depending on the investment you choose and the returns they generate.
By using the rule of 70, you can predict the amount of time it takes to double $50,000.
The rule of 70 states that the amount of time required to double your investments is equal to 70 divided by the rate of return.
For example, if you invest $50k into stock index funds that return 10% annually, it would take 7 years to double your money.
If you choose more risky investments that return much more, it can be possible to double your money in less than 5 years.
What is a $50,000 Investment Return?
The returns on your $50k investment will ultimately depend on the type of investment your choose and how well it performs.
For a well-diversified portfolio, it's common to grow at a rate of 7% to 10% annually. This means that your $50,000 investment would return anywhere from $3,500 to $5,000 for the first year.
It's important to note the impact that compound interest plays in this calculation. Your returns for the second year would include the initial investment plus any returns you made during the first year.
Here is a chart showing how your money will increase exponentially over time with a 10% return. You can see that after the 20 year mark, the return starts to increase more dramatically.
This is how many people are able to get rich from nothing.
What is $50k Invested for 10 Years?
If you invested $50k for 10 years in an index fund or ETF, and assumed a return of 8% annually, your balance would be equal to $107,946.
Final Thoughts on How to Double $50k
There are many ways to double $50k. Whether you choose real estate, starting your own business, or investing money in cryptocurrency – your bank account will certainly thank you.
It's completely possible to double $50k in 10 years or less with the right strategy and patience.
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