Imagine this. You have a certain amount of money to invest and you want to make at least 5%.
Maybe you're saving up for a home or you're looking to make another large purchase and you need the money.
Storing your money in a traditional savings account isn't the way to go – instead, finding other methods to grow your money is critical.
In this post, I'll explore where you can get 5% interest on your money and much much. Let's get started!
Best Places to Generate 5% Returns or More
Below are some of the top ways to get 5% interest on your money. While there are some 12% compound interest accounts, in general using investments that are stable and can generate returns of 5% are a good option to grow your money.
Invest in Real Estate with Arrived
If you want to earn interest on your money and have the potential to make a lot more than 5%, then investing in real estate is a tremendous option.
While there are some risks associated with real estate investing, it is a relatively safe investment over the long run and it's been proven time and time again.
It's been said by some of the most famous investors that 90% of millionaires became millionaires by investing in real estate. And there's no reason you can't be one of them thanks to platforms like Arrived.
Arrived allows you to invest in individual rental properties with just $100.
The returns you can expect will vary from property to property, but it's not uncommon to see returns over 10% for many properties.
Overall, if you want to earn 5% on your money – you need to check out Arrived!
$100 minimum investment so anyone can get started
- Access to individual properties so you can pick and choose which properties to fund
- Quarterly payouts depending on your properties performance
- Open to both accredited and non accredited investors
- Minimal 1% management fee
- Some offerings are funded quickly so you have to check frequently
Invest in Index Funds with Acorns
While this isn't the safest method to grow your money in the short term, it is extremely safe in the long run.
The average returns of the stock market are around 7% to 10% annually, which is much greater than the 5% you're looking for.
When compared to savings accounts or other options, your returns are much greater with index fund investing and it's easy to get started.
You can earn interest monthly from your investments, making it a great way to grow your money over time.
Open a new Acorns account below to claim your free $10!
Use a High Interest Savings Account
While most high interest savings accounts won't generate 5% interest, they can be a great place to store your emergency fund so there's no risk of losing it.
My favorite account is through CIT Bank. They offer 7 times the national average in interest so you can easily grow your money without worry.
At the time of publishing, you'll earn just shy of 5% interest at 4.2% interest – which is much more than any traditional bank would offer and you only need $100 to open your account.
Open your free account below to get started!
Invest in Commercial Real Estate with Realty Mogul
Another great option to generate returns of 5% or more is through commercial real estate investing with Realty Mogul.
With this platform, you can invest in office buildings, strip malls, and other commercial real estate assets to generate compound interest from your money.
The average return with Realty Mogul is over 8% – which is much greater than the return you're looking for.
This platform is open to both accredited and non accredited investors making it a great option for anyone to build wealth and generate interest from their cash.
Invest in ETFs
Exchange traded funds are another excellent way to earn interest on your money without much effort.
ETFs are great investments because they are diversified, which means you're not putting all your eggs in one basket. This minimizes risk and gives you the potential to generate excellent returns.
The average return of ETFs is around 7% to 10%, which is a great return for a relatively safe investment.
In addition, ETFs have very low fees leaving more of your returns in your pocket.
Whether you're looking to double your money or just generate 5% interest, ETFs are a superb investment to consider.
Invest in Dividend Stocks
Dividend stocks can be another easy way to get 5% interest on your money.
With dividend stocks, you'll invest in companies that pay dividends to shareholders on a routine basis.
There are some dividend stocks that pay dividends over 5%, in addition to the increase of the stock price over time.
For example, IBM has a dividend yield of 5.28% making it a solid option to make 5% interest on your money.
You can invest in dividend stocks with Acorns. Don't forget to claim your free $10 below!
Invest in Cryptocurrency
If you don't mind taking on some risk with your money, investing in cryptocurrency can be a great way to potentially earn 5% or more.
Bitcoin and other cryptocurrencies are well known for having wild swings in prices, so you need to be aware of this.
While this is by far the most risky investment on my list – even experienced investors are now taking stakes in this speculative investment.
Professionals recommend you don't invest more than 5% or 10% of your entire portfolio in these assets, but even a small exposure can be worth a significant amount.
You can use a platform like Binance to get started for completely free.
5% Interest Savings Accounts
There are a few savings accounts that offer 5% interest on your money. Some of the best include:
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Other Investing Options
Below are some other methods you can use to grow your wealth.
Rental properties are the most time consuming investment option on the list, but they can also make you the most money and become a money making machine.
With this real estate investment, you'll need some cash to get started. In most cases, you'll need at least a 20% down payment to close the deal which can add up to a large amount of money.
The average rental property generates a return of 10% to 15%. This return is after all expenses, including mortgage payments, maintenance, and vacancies.
To get started investing in rental properties, check out the video below!
Final Thoughts on Where to Get 5% Interest On Your Money
There are plenty of places you can get 5% interest on your money.
Your best and safest option is to open a high yield savings account with CIT Bank. This online bank pays 4.2% interest on your money – making it an easy way to generate the returns you want.
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