18 Smart Ways To Invest $10,000 Safely And Confidently

Are you looking to invest $10,000? These are smart ways to invest $10,000 and minimize risk.

Looking to learn the best way to invest 10k safely? Lucky you. If you need some help on how to invest $10,000 and avoid risk, let's get to work.

Because if you are reading this article, then it probably means you are either working actively towards amassing wealth to the tune of a 10k (by investing smartly) or you’re fervently hoping to win the lottery someday.

Either way, it’s smart to learn about how to invest and not spend this huge amount even before it hits your account. The reason is that $10,000 will not guarantee financial security unless the money is invested in ways that allow it to compound.

So it's important to invest your 10k with caution.

18 Ways to Invest 10K Safely

Before that $10,000 burns a hole in your bank account, let's work on investing it.

1. Pay off your debt.

The easiest way to invest your money is by paying off debt. It may sound odd but paying off your debt is the first and biggest investment you can make with $10,000 in your account. The interest on any debt you have grows with time and the sooner you pay it off, the more you will save.

You should know that the secret to success is paying off high-interest debt. Sure saving money and spending less is important but paying down debt is a worthy goal. Before you go off and invest $10,000, make sure your debt with the highest interest rates is paid off, in many cases that is going to be credit cards.

“So before you go dip your chunk of money into stocks, you'll likely get a better return on your money if you pay off your high-interest CONSUMER debt.”

According to the latest reports, the average credit card interest rate is 17.98% for new offers and 14.58% for existing accounts. While the average stock market return for 10 years is 9.2%, according to Goldman Sachs data for the past 140 years.

Are you picking up what I'm putting down? Or is your credit card debt all paid off? Let's move on.

2. Invest using a robo advisor.

These days you probably are seeing ads for a new robo advisor on the daily. The truth is, they keep on popping up left and right.

These robo advisors are helpful for consumers as they provide an automated and logarithm-based advising service and act as a financial advisor providing online financial advice online with little or no human consultation.

Sounds complicated. But they make it easy. Well, some of them like Acorns do.

Acorns takes the decision-making process away from you. The app analyzes your data — including age, objectives, income, and time horizon — before deciding on one of five portfolios that range from conservative to aggressive.

Overall, robo-advisors are a smart way to invest any amount of money without much risk. In fact, since 1928, the S&P 500 (a collection of the 500 largest stocks in the U.S.) has averaged roughly 7% in annual returns, even after adjusting for inflation.

3. Portfolio management.

If you are working with $10,000 in liquid cash — you are considered a high-net-worth client who would benefit from a personal touch. With that amount of capital, you can start investing with Empower.

Empower has two options. The first is a free net worth tracker and planning tool that collects information from your financial accounts and helps you make improvements to increase returns. That's a great option for anyone, no matter where you bank or invest.

The second option is using their asset management service that has a minimum account size of $100,000 to start. Once you join, you can get help setting goals for your money — primarily for your retirement. If you invest your money here, the app will invest your money based on the Modern Portfolio Theory (MPT) which ensures true diversification and they go a step beyond tax-loss harvesting. They will optimize your tax burden and your portfolio will be tax-efficient.

According to the company's own tests, they outperformed the S&P 500 by more than 1.5% annually with less volatility. Overall, it is a safe bet to open an Account at Empower to help you grow your $10,000 safely.

4. Real estate.

One joint study by the University of California and the German central bank found that over the last 145 years, real estate offered the highest returns of any asset class. Even better, it did so with far less volatility than stocks.

As such, one of the easiest ways to grow your money is to invest in real estate. Robert Kiyosaki, author of ‘Rich Dad Poor Dad’ learned to quickly grow his money by making down payments for rental properties and gaining profit by selling the property later at a higher price.

Another way to invest in real estate is by buying a property and renting it with companies like Arrived. With the ever-increasing inflation rate, rents will go up while your mortgage payments stay the same. This increases your cash flow and your rental yield as an investor.

Top offer pick

Arrived lets you invest in residential real estate and vacation rentals with only $100. It's an excellent option for anyone looking to earn passive income with rental units. And the platform is available to non-accredited investors.


You could also invest your 10K in raw lands with FarmTogether. Investing in lands is a profitable venture because of one key reason: land is scarce and its demand will always exceed its supply which makes it one of the best assets to build wealth.

5. Index funds.

Investing in index funds is like investing in the stock market without taking on too much risk. The risk of investing in index funds is very minimal yet the benefits are massive. The trick is to diversify your stocks by buying the largest companies through your index fund.

According to Bankrate, the best index funds to own this year are as follows:

  1. Fidelity ZERO Large Cap Index (FNILX)
  2. Vanguard S&P 500 ETF (VOO)
  3. SPDR S&P 500 ETF Trust (SPY)
  4. iShares Core S&P 500 ETF (IVV)
  5. Schwab S&P 500 Index Fund (SWPPX)

These index funds track the S&P 500 Index Fund and offer you a way to invest your $10,000 in stocks of the S&P 500 at a low cost, while still enjoying diversification and lower risk.

6. Mutual funds.

Another way to invest your $10,000 in the stock market is through mutual funds. A mutual fund is an investment vehicle that holds a portfolio of stocks, bonds, or other securities.

Since they hold many different securities, it makes it a very attractive investment option for someone who has $10,000 to invest. Investing your money in a mutual fund instead of individual stocks means you get diversification, convenience and lower costs.

According to Investopedia, the top 5 biggest mutual funds in the stock exchange are:

  1. Vanguard Total Stock Market Index Fund Admiral Shares (VTSAX)
  2. Fidelity 500 Index Fund (FXAIX)
  3. Vanguard Institutional Index Mutual Fund (VINIX)
  4. Fidelity Government Cash Reserves (FDRXX)
  5. Vanguard Federal Money Market Fund (VMFXX)

Some people may wonder how mutual funds are different than index funds? An index fund only seeks market-average returns (safe), while active mutual funds have fund managers that try to outperform the market. This means that the fees for active mutual funds are higher than index funds and less predictable returns.

7. Max out your retirement accounts.

You can invest in index funds and mutual funds in your retirement accounts and shoot for maxing out these accounts.

If your employer offers a 401(k) that matches employee contributions, and you aren't currently contributing enough to earn that match, let your extra 10k free up some space in your budget so you can do so.

The other option is to contribute to a Roth IRA or traditional IRA. These retirement accounts do have annual contribution limits — $6,000 in 2022 ($7,000 if age 50 or older). You can pad these retirement accounts in order to help prepare yourself for retirement down the road. Your retirement accounts commonly invest in index funds and ETFs, mutual funds, and are low-risk investments because your investments are diversified.

8. Start a business.

Starting a business is one of my favorite ways to get rich because of how much money you can make. You can easily make $10K a month by doing so with grit and determination. So why not invest your 10k in that promising business venture you put on the back burner for lack of money? If it is a high-risk business be sure to conduct research into your prospect, seek expert advice and develop a solid business plan before starting out.

Of course, the amount of money required to start your business depends on your business model and industry. However, a 2009 study conducted by the Ewing Marion Kauffman Foundation puts the average cost of starting a business is around $30,000.

Alternatively, starting a business with no money might initially seem like a far-fetched idea, but it's not impossible. You can even use a personal loan to start a business, in certain situations. The bottom line is that nothing is stopping you from launching a business and $10,000 is more than enough to get you there.

9. Invest in local businesses.

There are several crowdfunding sites that allow anybody to invest in real estate simply through an app. But what if you want to invest in a small business or startup?

You might invest in a publicly-listed companies on the stock market. However, you won't be able to get in at the beginning when a company is just getting started or taking off. This sector has typically been closed to non-accredited investors and venture capitalists with millions of dollars to invest.

Lucky for us, small business crowdfunding was made legal in 2015 by the regulation crowdfunding model. This has empowered hundreds of entrepreneurs and brought thousands of investors impactful returns.

10. High-yield savings account.

This is another way to invest your 10k. It’s much more profitable than the normal savings account. Your money can sit in there and accrue some interest until you are ready to invest in bigger and more profitable ventures.

Most experts recommend Axos Bank's High Yield Savings, where you can earn a very impressive .61% annual percentage yield which is an APY that’s 6X the national average. Comes with zero monthly maintenance fees and zero minimum balance requirements. On a $10,000 balance, you’ll earn $61 annually compared to just $10 (national average).

But there are other options, in the table below we show some of the best high-yield savings accounts, some of which offer 5% interest savings accounts.

Overall, robo advisors are a smart way to invest any amount of money without much risk. In fact, since 1928, the S&P 500 (a collection of the 500 largest stocks in the U.S.) has averaged roughly 7% in annual returns, even after adjusting for inflation.

11. Invest in yourself.

Investing in yourself is one of the best investments you could ever make and it can take many forms: pursuing a creative project, nurturing a talent taking a course, learning a new skill or pick up a new side hustle to get paid today.

While you won't likely spend $10,000 by investing in yourself, when you put your wellness first, your energy and production will increase at work which will yield better results and more revenue overall.

12. Donate to charity.

One of the best ways to invest 10K is to make an impact in the lives of the less fortunate through charitable giving. Investors who are into impact investing also get tax deductions. Most all charitable organizations qualify for a charitable contribution deduction.

You may deduct charitable contributions of money or property made to qualified organizations if you itemize your deductions. Generally, you may deduct up to 50 percent of your adjusted gross income, but 20 percent and 30 percent limitations apply in some cases.

13. Invest in an emergency fund.

One wise thing to do once you have your 10k in hand is to set up an emergency fund or fund it if you already have one. It will shield you from life’s unpleasant surprises.

As you may have guessed, there are so many ways to invest your $10,000 with confidence. You might choose one particular method, or you might choose to diversify. Just make sure to invest somehow so you can offset inflation and your wallet will thank you for it!

14. Treasury bonds.

Treasury bonds can be an excellent investment for those looking for safety and a fixed rate of interest that's paid semiannually until the bond's maturity.

There are 4 different types of treasury bonds (NerdWallet):

  • Treasury bills (or T-bills): Short-term debt securities that mature in less than one year. Though T-bills are sold with a wide range of maturities, the most common terms are for four, eight, 13, 26 and 52 weeks.
  • Treasury notes (or T-notes): Intermediate-term debt securities that mature in two, three, five, seven and 10 years.
  • Treasury bonds (or T-bonds): Long-term debt securities that mature between 10 and 30 years.
  • Treasury Inflation-Protected Securities (or TIPS): Another type of Treasury bond, adjusted over time to keep up with inflation.

Overall, treasury bonds should play a strong role in your portfolio's asset allocation because it provides steady returns and can help offset the volatility in the stock market. You can purchase Treasury bonds directly from the Treasury Department through its website, TreasuryDirect, or through any brokerage account.

15. Invest in art.

Contemporary art has offered an annual return of 14% over the last 25 years, as of December 2020, versus a 9.5% annual return from the S&P 500, according to the Citi Global Art Market chart.

If you want to invest in art, Masterworks is a good place to start. You can buy and sell shares in multimillion-dollar paintings on the Masterworks platform. If you decide to keep your shares until the painting sells, you'll receive proceeds from the sale.

Read more on how to invest in art in order to decide if it's a smart way to invest 10k.

16. Peer-to-peer lending.

This is a way to make a direct impact on the lives of people. This is how it works: you sign up on a platform like LendingClub or Prosper and start giving loans to peers registered on the platform. You can buy into a thousand different loans to spread out risks and earn a profit in the form of interest.

17. Invest in commodities.

Investing in commodities can provide investors with diversification, a hedge against inflation, and excess positive returns. Commodities are interchangeable goods that are used in manufacturing processes around the world and they are an important part of our everyday life. They can be divided into four major categories:

  1. Precious metals (gold, silver, copper, palladium, and platinum).
  2. Energy resources (natural gas, crude oil, coal, and propane).
  3. Agricultural – soft commodities (coffee, corn, sugar, cotton, soybeans, rice, and cocoa).
  4. Livestock (pork bellies, live cattle, feeder cattle, and lean hogs).

Now that you know which they are, you’ve probably identified at least 3 commodities that you use on a daily basis. The price of your morning coffee or the gas you use to drive to work every day depends on the supply and demand, as well as on the way these assets perform on the commodities market.

To gain access to this market, foremost, you need to register for an account with an online broker or use commodity trading apps that offer commodity trading from gold and crude oil to pork bellies and coffee. These assets are an efficient way to expand and diversify your portfolio.

18. Cryptocurrency.

Cryptocurrency is powering ahead like never before. The overall market cap exceeded $2 trillion in early 2022.

The tide started changing rapidly in recent years with more and more mainstream players feverishly entering the digital assets space, for example, Mastercard, JP Morgan Chase, and of course, Elon Musk, the world’s richest person.

While it all started with just one crypto, Bitcoin, back in 2009, there are now over 14,000 different coins and tokens to choose from, tradeable at more than 400 cryptocurrency apps and exchanges.

Through all the market upheaval and turbulence of the past decade, yes, many feared the total demise of crypto, Bitcoin has proved its resilience and agility over and over again.

Today it’s still number one and people are making money with Bitcoin. Bitcoin’s market cap represents 43% of the entire industry, with its closest competitor Ethereum at 19%. It’s perhaps safe to say, Bitcoin is here to stay so you may want to invest some of that $10k into cryptocurrency to diversify.

Related: How To Get Free Bitcoin

19. Annuities.

This is a low-yielding investment that could pay as low as 3% on your capital. An annuity is a way to supplement your income during retirement.

Annuities can be a smart option since it provides regular payments, tax benefits, and a potential death benefit. The other advantage is that your capital is kept safe and your returns are guaranteed.

Things to Keep in Mind Before You Invest $10,000

Before investing $10,000, take a deep breath and go over your financial situation. Do you have any pressing financial issues that you need to deal with? Before investing this money that's liquid, you should make sure everything else is in order.

This generally means that you already have an emergency of three to six months set aside, you are paying down debt already, and you need to understand what type of investor you are.

Because you only know your risk tolerance, so that alone will help you decide which way you want to invest your money.

Whether you want to use it as a down payment on a rental property, pay off some expenses, invest in a CD, or a taxable brokerage account, it's all up to your risk tolerance.

If you're looking to invest a larger amount of money, you can see how to invest $25k safely.

For you: What ways have you found to invest or which best way to invest 10k safely did you like best?

Top offer pick

Arrived lets you invest in residential real estate and vacation rentals with only $100. It's an excellent option for anyone looking to earn passive income with rental units. And the platform is available to non-accredited investors.

Brian Meiggs
Brian Meiggs
Brian Meiggs is a personal finance expert, and the founder of Smarts, a personal finance site helping you easily explore your best money options. He helps readers follow the smart money in order to increase their earning potential and start building wealth for the future. He regularly writes about side hustles, investing, and general personal finance topics aimed to help anyone earn more, pay off debt, and reach financial freedom. He has been quoted as a top personal finance blogger in major publications including Business Insider, Yahoo! Finance, NASDAQ, Discover, and more.
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