Every investment, no matter how “safe,” has an element of risk to it, and you need always to remember this when you’re looking for a major financial boost. Get stock recommendations, portfolio guidance, and more from The Motley Fool’s premium services. You might be able to double your money by forcing appreciation in a building through repairs and renovations. If you live in the building for two years while fixing it up, you can also avoid a lot of taxes.
How can I double my money without risk?
With the right investments, you can easily double your income in a single day. A professional financial advisor may be your best bet for achieving specific investing goals, but the Rule of 72 can help you get started. Whether you want to evaluate offers that promise to “double your money fast” or establish investment goals for your portfolio, a quick-and-dirty method will show you how long it will take to double your money. It’s called the Rule of 72 and can be applied to any investment.
Invest in yourself
For example, a 20% down payment on an investment property worth $500,000 would require an investor to plunk down $100,000 and get a mortgage for the balance of $400,000. If the property appreciates 20% to $600,000 in the next few years, the investor now has equity worth $200,000 in it, which represents a doubling of the original $100,000 investment. When it comes to the most traditional way of doubling your money, that commercial is not too far from the truth. The time-tested way to double your money over a reasonable amount of time is to invest in a solid, balanced portfolio that’s diversified between blue-chip stocks and investment-grade bonds.
Achieving Your Investment Goals
“There are no safe ways to double your money quickly,” says Adam Sommers, lead planner and chief investment strategist at Sommers Financial Management. The Rule of 72 can help you determine what types of investments or financial products can help you achieve your goal. If you need to double your financial investment https://www.kelleysbookkeeping.com/ in 10 years, a savings account with a 5% interest rate, for instance, wouldn’t help achieve your goals. You’d need something with a higher rate of return (at least 7.2%) to make that 10-year milestone happen. Don’t assume that being a value investor dooms you to slower-growing companies, either.
Should I invest in cryptocurrencies if I am a conservative investor with very low risk tolerance?
Investing in dividend-paying stocks is another good way to work on doubling your money. They’re stocks like any other, with their prices rising over time as long as the companies are healthy and growing. But along with that usual stock-price appreciation come dividend payments, which also tend to grow over time. If your employer offers a 401(k) plan, it’s usually a very good idea to participate.
Stock options, such as simple puts and calls, can be used to speculate on any company’s stock. For many investors, especially those who have their fingers on the pulse of a specific industry, options can turbocharge a portfolio’s performance. The prospect of rising interest rates also reduces the appeal of real estate investment.
- Let’s now turn to the time and risk attributes of an investment itself.
- Thus, alternative investments can include a variety of investments, such as private equity, real estate, commodities, collectibles and cryptocurrency.
- We know that past performance does not guarantee future returns.
- The time-tested way to double your money over a reasonable amount of time is to invest in a solid, balanced portfolio that’s diversified between blue-chip stocks and investment-grade bonds.
- Depending on your income, the states you live and work in, and filing status, the tax benefit could be somewhere around 22% federal and 3% state — or 25% total.
- This is a short article which explains if $20 an hour is considered good money and how much it works out to annually.
That said, the return in any single year is likely to be much different – higher or lower – than the average. The S&P 500 made up for it basic accounting terms you need to know in the 2010s, returning 252 percent – more than tripling. The offers that appear on this site are from companies that compensate us.
With standard coupon bonds, there are the challenges and risks of reinvesting the interest payments as they’re received. With zero-coupon bonds, there’s only one payoff, and it comes when https://www.kelleysbookkeeping.com/accounting-period-definition/ the bond matures. Familiarizing yourself with the various investment options available and how to make the most of them is your first step to doubling your money while mitigating risk.
The method you choose depends largely on your appetite for risk and your time line for investing. You may also consider adopting a mix of these strategies to achieve your goal of doubling your money. Doubling money is a prospect that few people would turn down, and it isn’t necessarily that difficult to achieve.
The S&P 500 delivered a phenomenal total return of 100% in the three years from 2019 to 2021, despite plunging 35% within a six-week period in February and March of 2020. An investor who held an investment like the SPDR S&P 500 ETF (SPY) over these three years would have seen it double in value. The only caveat is that your 401(k) is designated for retirement. As such, there can be steep penalties for withdrawing before you reach retirement age.