9 Unique Ways to Invest $1,000 to Real Build Wealth

You might think you need to be rich to start growing your wealth through investing. However, believe it or not, there are several ways to invest $1,000. For example, certain companies have created investment options for the average person.

They’ve done that by setting lower minimum thresholds for opening accounts. Many companies allow you to start investing with as little as $100.

These investment options offer choices for people with smaller amounts of cash looking to build their retirement account or savings accounts. Here are some options to consider if you’ve got $1,000 you want to invest.

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How to Invest $1,000

So, are you wondering how to start investing a smaller dollar amount? If so, check out these ways to invest $1,000.

1. Invest In Certificates Of Deposit

A Certificate of Deposit (Bank CD) won’t pay you the highest interest rate. However, it is a mostly risk-free investment you might like if you’re risk-averse.

For example, CIT Bank is currently paying up to 3.75% on its CDs. Other banks may even be paying higher rates.

You may even want to consider building a CD ladder to keep your money more fluid and take advantage of positive rate changes.

2. Use A Robo Advisor

Investing in the stock market is another way to grow your $1,000 into much larger numbers. Understandably, you might worry that you don’t know enough about stock market investing to get started.

The good news is that today’s stock market investing companies have made investing easier. Hiring a financial advisor used to be a necessity for investing in the stock market. However, the following companies partner with investors differently.

They help investors through a robo-advisor that uses algorithms to invest in the best way for you. Betterment is one of the most popular robo-advisors around in the United States. They focus on offering Exchange Traded Funds (ETFs).

They charge an annual asset management fee of between 0.25 percent and 0.40 percent. The fee depends on whether you open their Digital account or their Premium account.

3. Peer-to-Peer Lending

Peer-to-peer lending is a form of investing where you work with others to lend money to people in need of loans. These borrowers don’t head to a traditional bank, credit union, or lending company for a loan.

Instead, they apply to a peer-to-peer lending company such as Prosper for a loan. The money loaned to them (once they’re approved) comes directly from investors like you and me.

As an investor, you’ll be privy to valuable information about the potential borrower. For instance, you’ll know the borrowers:

Credit score
Important credit history information
Employment information
Income information

Each member investor then decides whether to take on the risk of lending the applicant some of their money.

Investment returns are based on the interest rate the P2P lending company charges the borrower. The riskier the loan, the higher the interest rate the borrower pays.

The less risk involved, the lower the interest rate the borrower pays. Investors earn a portion of the interest rate charged on the loan as their investment return.

A payment is made each month, and a portion goes to the investors who funded the loan. P2P lending investments can be high risk, but they can also offer higher returns than other types of investments.

4. Invest In Online Real Estate

Wondering what online real estate is? It’s the fabulous world of blog site or website ownership. When website owners talk about making money from their websites, people often think of unicorns, fairy tales, or money-making scams.

But I’ve learned firsthand that you really can make money by owning blogs or websites. My first money-making blog recently sold for more than $10,000.

Before that, it consistently earned me an average of $500 a month. Many websites, including Better Finance Info, earn much, much more than that in monthly income.

What if you could take your $1,000 and use it to buy a money-making website? You’d start receiving the income proceeds instead of the former owner. If you can do this, you can make your $1,000 back – and more – in a relatively short time.

5. Start Your Own Business

Another way to invest $1,000 is to start your own business. If you run it right, you can make big money fairly quickly. The first key to a successful business is to choose a business that aligns with your talents. What can you do? Can you design websites? Do you have a skill you can sell?

When I started my freelance writing business 5 years ago, I spent well under $1,000 to get it up and running. Today, I make five digits a year writing for clients. Here’s another story. I know a guy who started an SEO business five years ago.

He knows a lot about SEO, so he started servicing businesses out of his home. The startup costs were minimal since he was selling a skill.

Last month, he sold that SEO business for six digits. That’s one heck of an ROI (return on investment). Yes, he did have to work hard to grow the business, but the payoff was well worth it.

There are so many business ideas you could consider with your $1,000. Start thinking outside the box and find a way to meet others’ needs. Then, use that idea to start and grow a business.

6. Open a Roth IRA

A Roth IRA works differently from a traditional IRA. With a traditional IRA, you can deduct the money you invest from your taxable income. Roth IRA contributions aren’t tax-deductible. However, the income you gain from investing in the Roth IRA funds is tax-free.

Take the money and put it into a Roth IRA with a company like Vanguard or Betterment. Choose your product based on your risk tolerance level.

A Roth IRA can be a good investment choice because everyone can benefit from saving more for retirement. And since your earnings grow tax-free, you never have to worry about counting them on your taxable income.

7. Invest in Yourself

If you want to grow your money long-term, why not invest in yourself? Udemy offers courses on just about anything.

Here are some of their current course offerings categories:

Web development
Business and entrepreneurship
Health and fitness
Language
Academics
Marketing

You can use the skills you learn from investing in yourself to start a lucrative side business. Maybe you will become a website designer. Or a life coach. The choices are nearly endless.

Read books, take courses, meet with mentors, or join a gym. Take your $1,000 and invest it in a way that will help you or your family lead a better life.

Learn a new skill so you can leave the 9-to-5 job you hate. Start that business you’ve always wanted to start. Just do something to ensure you’re making a better life for yourself.

8. Invest In Crowdfunded Real Estate

When you invest in real estate via crowdfunding, you join together with a group of other investors. Together, you fund a real estate investment project. The crowdfunding company screens clients seeking money (i.e., borrowers).

Or, the owners of the crowdfunding company are the investors. In other words, the company does all the hard work for you. Investing in crowdfunded real estate investing is truly passive income.

There are several crowdfunded real estate investing companies out there. How can you know which one is right for you? One crowdfunded real estate investing company is Fundrise. It’s popular with investors for one main reason.

That is because Fundrise works to make real estate investing affordable for nearly everyone. With Fundrise, you no longer need $100,000 in cash to invest in real estate.

In fact, Fundrise requires a minimum investment of $10, making real estate investing even more affordable.

9. Consider Alternative Investments

Another option for investing your $1,000 is to invest in alternative types of investments.

Alternative investments can take many forms, such as:

Art
Collectibles
Cryptocurrency
Wine

And more. Of course, these investments come with much more risk than the other ideas mentioned here.

But then again, $1,000 isn’t usually life-changing for more people. For that reason, you might find the potential gain well worth the risk.

Summary

There are many ways to turn $1,000 into much more money. It just takes making a wise and calculated investment. Look through the list above and decide which choices best suit your financial goals.

Start growing your wealth by deciding which one (or more) of these investment options best suits your investment knowledge and your risk tolerance.

Sooner than you think, you’ll see that nest egg grow into much more money if you choose the right investment option.

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