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How to invest $50K

The stock market offers a variety of investment options, but there are other opportunities to consider.

How to invest 50k

When you’re wondering what to invest in with $50,000, the answer often lies in “diversify in multiple options”. This includes stocks, ETFs and real estate and more. But not all options are suitable for every investor. Here are 7 ways for how to invest 50k:

  1. Individual stocks
  2. Retirement accounts
  3. Exchange-traded funds (ETFs)
  4. Robo-advisor
  5. Alternative investments
  6. Real estate investment trusts (REITs)
  7. Cryptocurrencies

1. Individual stocks

One of the best ways to invest 50k is in multiple individual stocks. You can choose from:

  1. Dividend stocks. These stocks allow shareholders to profit from a potential rise in the stock’s share price. They also provide a relatively low-risk source of investment income.
  2. Penny stocks. Penny stock are small-cap stocks that can be traded for less than $5.
  3. Blue-chip stocks. If you’re looking for stability and low risk, blue chip stocks are from huge, well-established companies with popular brands and products like Apple, Amazon and Coca-Cola.
  • Great performance. The average annual return of the S&P 500 index in the past 70 years is 10%. This is way better than what you can get with a savings account. What’s more, some stocks pay out dividends each quarter. This goes on top of the potential gains the stock could earn.
  • Variety of options. There are thousands of stocks to choose from, ranging from the oil industry to companies in the health and tech sectors.
  • High liquidity. The stock market is one of the most liquid markets, meaning you can buy or sell your shares during market hours and chances are high that someone will take the opposite side of your trade.
  • Volatility. The stock market is strongly affected by macroeconomic and monetary factors. When there’s high inflation and rising interest rates, the stock market tends to underperform. In times of near-zero interest rates and high money supply, stocks tend to skyrocket.
  • Requires research. You can hardly go wrong with companies like Microsoft (MSFT) and Apple (AAPL). But to find the next Microsoft and Apple before they become popular requires a lot of research.

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How $50,000 can grow

With $50,000, you can start building serious wealth with enough time and smart decisions. Here’s a look at how it might grow in three common investment classes.

$50,000 saved or investedSavings accountBondsStocks
1 year$50,500$53,000$55,000
5 years$52,551$66,911$80,526
10 years$55,231$89,542$129,687
15 years$58,048$119,828$208,862
20 years$61,010$160,357$336,375
25 years$64,122$214,594$541,735
30 years$67,392$287,175$872,470

For this table, we assumed a 1% annual return on a savings account; an average 6% return for bonds; and 10% on stocks, the market’s long-term annual return. Bond returns vary widely based on bond types, and the stock market has down years while individual stocks can go to zero. So consider these as benchmarks only and consider risk as well as return.

2. Retirement accounts

Timing in the market is everything. The sooner you max out your retirement account, the faster you can reach your retirement goals. If you have already maxed out your 401(k) or will do so by the end of the year, consider opening and maxing out an IRA account.

  • Tax benefits. You won’t pay taxes on the money you add to your investment account or on its earnings, such as dividends and capital gains, until the moment you withdraw from your account.
  • Matching contributions from your employer. 401(k) accounts may come with a company match, which comes as “free money.”
  • Same investment options. Your retirement accounts offer the same investment options in stocks and funds that you would also invest in outside of your retirement.
  • Withdrawal limitations. Withdrawing your funds until you reach 59½ comes with penalties.
  • Deposit limitations. You can’t deposit your entire $50,000 in one year into these accounts. The 2022 401(k) contribution limit is $20,500, and $6,000 for IRA.

3. Exchange-traded funds (ETFs)

Investing in ETFs have two main advantages over investing in individual stocks: instant diversification and saving money on fees. That’s because you hold multiple stocks or assets with one purchase instead of buying them individually all by yourself. ETFs are by far one of the best ways to invest 50k.

  • Variety of investment options. ETFs are funds that hold baskets of assets including stocks, bonds, commodities, currencies and more. This gives you an unparalleled variety of investment options to choose from.
  • Trade like stocks. Unlike mutual funds that trade only once a day, ETFs are open and highly liquid during market hours. Basically, ETFs trade like stocks.
  • Convenience. Getting exposure to the tech sector means you have to buy dozens of stocks individually. An ETF solves this issue by holding all these stocks in one fund. All you have to do is make a single transaction and you hold the exact same assets with one ETF and without the hassle of choosing the stocks yourself.
  • Expense ratio. ETFs charge a fee annually, called expense ratio. Typically, this is less than 1% but it’s a cost nonetheless.
  • Leveraged ETF gains can be misleading. Leveraged ETFs may sound enticing given they move 2x and 3x the market price of nonleveraged ETFs. However, they are rebalanced daily using complex derivatives, which means your results won’t be 2x and 3x of the non leveraged ETF in the long run.

4. Robo-advisor

Robo-advisors are algorithms that automatically invest your money on your behalf based on parameters that you set, such as your risk tolerance. This gives you the opportunity to invest 50k in the stock market without doing tons of research.

  • Great for hands-off investors. Set your risk appetite and how long you plan to hold your investments and the robo-advisor will allocate your funds and rebalance your portfolio constantly.
  • Invests in ETFs and mutual funds. Robo-advisors invest in the same assets as you would invest in yourself. This makes them a relatively safe option.
  • Less expensive than a financial adviser. Robo-advisors cost less than financial advisers. But they can better rebalance your portfolio on a daily basis if need be and they cost a fraction of what you would pay for a person to do the job.
  • Robo-advisors aren’t human. Robo-advisors can’t create a long-term financial plan for you.
  • Can’t handle complex portfolios. As a rule of thumb, financial planners are typically best to manage portfolios worth six figures and more.
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5. Alternative investments

Aside from the “regular” investment options, consider alternative investments such as nonfungible tokens (NFTs), historic works of art, collectibles and more.

  1. lets you invest in crypto, NFTs, fine art and collectibles with more alternative assets to come. The way this works is you buy shares for these assets like you would buy shares from a company on a stock exchange, and you hold it in your portfolio. You can also purchase fractional shares if an asset is too expensive.

6. Real estate investment trusts (REITs)

Interestingly, you don’t have to directly buy a house or any other property to get into real estate — you can invest in REITs or through crowdfunding platforms and own shares of properties with $50,000 or less.

  • Earn rental income. REITs are professionally managed portfolios that invest in housing and commercial real estate. The REITs often distribute the rental income to its shareholders, which comes as a form of dividend payment.
  • Capital appreciation. Physical properties tend to increase in value as time passes. Your initial investment can be worth way more in 10 or 20 years.
  • Some REITs are publicly traded. Large and popular REITs are traded on exchanges such as the NYSE. This means you can trade them like you would trade any other stock during market hours.


  • High taxes. Depending on your tax bracket, you could pay as high as 37% for REIT’s dividend payments.
  • Low liquidity. Privately-held REITs inherently come with lower liquidity, meaning it could be hard to sell your investment whenever you want.

7. Cryptocurrencies

This is investment option comes with high risk and high reward. If you’re willing to take the risk, consider investing a small amount of your $50,000 but beware of the extreme volatility of the crypto markets.

  • Potentially high returns. The global crypto market cap is less than $900 billion, which is less than the $2.3 trillion market cap of Apple (AAPL). If cryptocurrencies become mainstream in the future, the growth potential is massive.
  • Traded 24/7. Cryptocurrencies are traded 24/7, meaning you can buy or sell whenever you want.
  • Strong market infrastructure. Most popular cryptocurrencies can be staked or lent to other parties. This earns a percentage back in the cryptocurrency you use.
  • Volatile. Don’t be surprised if your crypto portfolio sees major swings to the upside and down. Because the crypto market is smaller than the stock market, it can be more easily affected by large amounts of money entering and exiting the market.
  • Variety of risks. The crypto market is mostly unregulated, which comes with risks such as exchange collapses and scams. If you’re not using a hardware wallet like Ledger or Trezor or if you forget your private keys, you risk losing your cryptocurrencies.

Before you invest

One thing is certain: $50,000 is a lot of money. Make sure you prepare and understand your investment options before you invest this money. It may be better suited elsewhere.

  • Pay off your debt. You may earn more money by investing your $50,000 in the right way and then paying off your debt. But you could also lose money if market conditions change or you make a wrong investing choice. Make sure to pay off your liabilities first or at least have a repayment plan before you invest your money.
  • Create an emergency fund. An emergency fund will protect you in emergencies like job loss or a catastrophic event. If you invest all your money, you could suffer losses if you have to withdraw your investment sooner than you otherwise would.
  • Diversify your holdings. This doesn’t mean you shouldn’t invest all your $50,000 in the stock market alone: It means not putting all your money in a single stock or sector.

Bottom line

  • Some of the best ways to invest $50,000 is in your retirement account, in the stock market or in real estate. If you don’t have the time to research and pick stocks yourself, consider a robo-advisor to manage your portfolio.
  • Typically, it’s best to divide your $50,000 among multiple investment options than to lump it all into one.
  • Balance the pros and cons of each option before you commit your hard-earned money.
  • Paid non-client promotion. Finder does not invest money with providers on this page. If a brand is a referral partner, we're paid when you click or tap through to, open an account with or provide your contact information to the provider. Partnerships are not a recommendation for you to invest with any one company. Learn more about how we make money.

    Finder is not an adviser or brokerage service. Information on this page is for educational purposes only and not a recommendation to invest with any one company, trade specific stocks or fund specific investments. All editorial opinions are our own.

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