So you have $1,000 and you want to turn it into more.
Congratulations! You are already ahead of over 60% of people who couldn’t even come up with that amount in an emergency.
But how can you invest $1,000 and double it, triple it, or even more? Depending on your skills, tolerance for risk, and timeline there are all kinds of ways to invest 1,000 dollars and turn it a lot more.
But first, a disclaimer: If you came here looking for an easy get-rich-quick scheme to invest $1,000 and double your money immediately you will be disappointed. There are no shortcuts to investing – you either need to put in the time, the work, or the skills to increase your investment. But if you are willing to put in the hustle, you can easily learn how to let your money start working for you instead of the other way around.
The Only 3 Ways to Double Your Investment
The way I see it, there are only 3 ways to turn $1,000 into $2,000. These methods work whether you have 1 dollar, 1,000 dollars, or 1,000,000 dollars. You need to either put in time, hard work, or unique skills (or some combination of the 3).
For example, if you want to double your money fast, you’d better be willing to put in a lot of hard work or have a lucrative and in-demand skill. If you don’t want to put in a lot of work, you need to let time and compound interest do it’s thing with a more passive investment strategy.
1. Double Your Investment With Time
This is the traditional method of investing and making your money work for you. As Albert Einstein was famously quoted as saying, compound interest is the eighth wonder of the world. If you put $1,000 in the stock market, and it returned 8%, in 9 years you would double your investment. While that might not seem that impressive, consider that if you put $1,000 away when you were 20, by the time you retired, it would have doubled 5 times over and be worth almost $32,000!
The Rule of 72 – A Handy Guide to Doubling Your Money
The Rule of 72 is a rule of thumb that says how long it will take to double your money given a fixed interest rate. If you divide 72 by the annual rate of return, it will tell you how many years it will take to double your investment.
So for example, if you had an 8% rate of return, it would take 72 / 8 = 9 years to double your money. If you had a 12% rate of return, it would take 72 / 12 = 6 years to double it.
2. Double Your Investment With Hard Work
If you are willing to work hard, there is no limit to the amount of money you can earn. Taking your initial $1,000 investment and turning it into $2,000 is as easy as trading your time for money. For example, you could use your money to buy some lawn mowing equipment and go door-to-door selling lawn care services. If you could make $25 per hour, you’d make your $1,000 back in 40 hours and quickly increase your profits from there.
3. Double Your Investment With Skill
This is closely related to hard work, but there is less of an element of trading your time directly for money, and more emphasis on learning a skill or investing in assets that continue to pay you regardless of how much time you put in. Taking our lawn mowing example, what if you invested $1,000 in turning your lawn care job into an actual business, where you were the CEO and you hired out the marketing, sales, and actual lawn mowing to employees. Then it wouldn’t matter if you showed up for work or not, you’d still make money passively because of the asset you owned (the business) and its ability to generate cash without your perpetual involvement.
5 Ideas to Invest 1,000 Dollars and Double It
Here are a few ideas using the concepts presented above of time, hard work, and skill to take any investment and double it (or even 10X it!)
1. Double Your Money Instantly by Investing $1,000 in Your 401(k)
Ok, I know – this is super boring and standard advice. But hear me out!
This is honestly the best chance at free money you’re ever going to get. According to FINRA (a super boring investment regulation organization), 1 in 4 people do not take advantage of their company’s 401(k) match.
My company matches 100% of the first 4% I contribute, so if I put in $1,000, my company puts in $1,000. Boom! Instant 100% return! This is the easiest money you’re going to make, courtesy of your employer.
If you aren’t taking advantage of your employer 401(k) match, chances are you aren’t optimizing your portfolio for retirement either. If that’s the case, I highly recommend getting a free 401(k) analysis with Blooom.
It is simple to connect your account, answer a couple of questions, and Blooom will give you some suggestions (for free!) on how to reduce fees or re-allocate your portfolio for better risk-adjusted performance. While it might not seem like much, if you can just reduce your fees by 1%, over your working career it can add an extra 50% to your retirement fund!
I signed up for Blooom’s free analysis and got a few great suggestions in under 5 minutes on how to switch up a few index funds to lower my fees. While Blooom will give you the advice for free, they also offer a paid option to execute the plan for you and keep it optimized. I am comfortable getting in there and doing it myself, but if you’re not, I think the paid plan is certainly worth looking into (but get the free advice first).
2. Invest in Yourself Through Entrepreneurship
Whether starting a side hustle or a full-fledged business, $1,000 is enough to get started in all kinds of entrepreneurial ventures.
I talk to people all the time who stress out about finding the perfect idea to start a business, but let me tell you a little secret. Most successful businesses are not the next Apple. They aren’t even unique. They just involve matching a skill you have with a need in the market.
“But I don’t have any skills!” I would argue you do, you’re just too close to yourself to see what unique abilities you can offer in the market. Take a poll of your family, friends, and co-workers to see what they think you are better at than the average person. Chances are you’ll get the same answers over and over.
Even if you don’t have any skills, there are plenty of gig economy jobs out there that require no skills, or minor things you can learn on the job. For example – can you drive? Great! You likely qualify to shuttle people around and make money with Uber or Lyft! And bonus, you don’t even have to invest $1,000 to get started.
Of course, the more unique skills you can bring to the market, the more money you’ll be able to make. Here are a few ideas:
- Turn your love of thrifting and garage sales into an eBay business. I interviewed a guy who makes hundreds of dollars per month selling garage sale finds on eBay. He started slow with a small inventory, learned what worked best, and scaled up from there.
- Good with numbers? Start a bookkeeping business! There are tons of small business owners out there who are great at their particular skill set, but struggle when it comes to the actual numbers side of the business. You don’t need a ton of money to get started – just a website and
- Turn hard work into $$$. Like I mentioned in a previous example, you can get started mowing lawns for much less than a 1,000 dollar investment. If you can push a lawn mower and rake leaves, you can have a booming business. This is one of the many things I’ve done over the years to make extra money.
3. Invest in Real Estate to Double Your Net Worth Many Times Over
You may not think you can get started investing in real estate with only $1,000. And while you probably won’t be able to buy a house with that amount of money, there are a lot of ways to make money in real estate without a huge upfront investment.
Real estate is where we’ve invested most of our money and eventually learned how to make money passively, through assets rather than trading our time for money.
We actually saved up to buy our first rental property, which was great, but then we were out of money. We wanted to keep investing in real estate, but didn’t know how. So we started learning, and found that with the right skills, you can make money in real estate without a lot of capital as long as you were willing to work a little harder.
If you only have $1,000 or less to get started, here are some things you can do to double your investment (and much more).
- House flipping. This is the first thing we did after we used up all our available cash on our first rental property. If you can find a great deal on a property (which is a skill you can learn), you can get a bank or hard money loan to cover the purchase and rehab costs. Realistically you will need some cash to cover closing costs and other incidentals, but there are creative ways to do it with only a small investment nest egg.
- Contract flipping (wholesaling). After our first house flip, we discovered wholesaling, which is finding a good deal, putting it under contract, then selling your interest in that contract to another investor who is willing to close on the property and do the rehab. The skill here is finding good enough deals that other investors will pay you for them. It is not particularly difficult, but it does require hard work and consistency. Once we figured out this business we were able to invest a small amount in marketing to find good deals, and selling those deals for a 5-10X return on our money!
- Become a real estate agent. This is similar to any other side hustle or entrepreneurial venture. You are investing your money in your education and licensing, then you can go out and find clients and make a return on your investment. My wife ended up getting her real estate license to help us save money on our own transactions, and we were unexpectedly surprised that she has been able to make $15-20k every year just by taking on a few friends and family clients. After taking into account the cost of maintaining her license every year, that is a 400-500% return for a few hours of work every month!
4. Get a Guaranteed Return on Investment by Paying off Debt
While not as sexy as real estate or starting your own business, this is a really solid way to earn a good return on your $1,000.
If you are carrying credit card or other consumer debt, you could be paying interest rates as high as 15-20%. This is costing you a ton of money, but on the other side of the equation it is a great investment for the credit card company!
By flipping the script and paying down debt with a 20% interest rate, you are essentially getting a guaranteed 20% return on your money. Using the Rule of 72, you would be doubling your money in less than 4 years by the interest payments you are saving (72 / 20 = 3.6).
5. Start a Savings Account for a Rainy Day
A lot of investments that give you the potential for great returns require that you invest for the long term. Putting your money in stocks, real estate, or a new business is great for doubling your money and continuing to compound it over time, but you don’t really have access to your initial investment anymore.
Sometimes it is better to have money tucked away for emergencies, or to fund a purchase in the near term. If you are about to buy a car, for example, you don’t want your money locked up in the stock market. While returns over the long term have been high, there is a lot of volatility and you could lose a significant amount of your money in the short term.
Similarly, if you’re saving up to buy your first rental property, you want to keep the money somewhere safe while earning the best return you can get.
The last few years have seen the rise of many online-only banks such as Ally or CIT Bank that pay 10X or more interest compared to a big bank like Chase or Wells Fargo. I personally keep my emergency fund savings in an online account earning me over 2%. While you won’t double your money at 2% anytime soon, you can be assured it is safe while you grow your nest egg to invest in something bigger.
How to Get the Best Interest Rate for Your Savings Account
If you’re looking for a great place to park your savings, I’ve researched a lot of banks, and CIT Bank has the highest interest rate I’ve seen anywhere. They currently offer 2.45% with their savings builder account!
Even though I love banking with USAA, their tiny 0.1% savings account rate has caused me to move the bulk of my savings elsewhere where I can earn a decent return.
Investing $1,000 – The Options Are Endless
There are so many ways to invest 1,000 dollars and double it, triple it, or 10X it! Hopefully this post gave you some new ideas to try you hadn’t thought of before.
Just remember the prerequisites for getting a great return on your investment – time, hard work, and skill. There are no easy get-rich-quick schemes on the path to financial freedom.
What are some unique ways you’ve invested $1,000 to double your money? Let me know in the comments!