Sat Sep 14 2024, by Tyler Gardner

Four Effective Ways to Invest $10,000 Cash for Maximum Growth

Here are four things you could do right now with $10,000 of cash. I'm Tyler, a former financial advisor and portfolio manager, now making financial content for free so you don't have to pay for it.

1. Traditional Savings Account

Put it in a traditional savings account. Have it lose about 3% of its value a year and have the purchasing power of $4,010 in 30 years.

2. High Yield Savings Account

Put it in a high yield savings account. Have it earn about 4 or 5% a year, minus the 3% inflation, minus another 25% or so on taxes on the interest, resulting in a net gain of about 1 to 1.5%, and have the purchasing power of $15,630 in 30 years.

3. Brokerage Account

Put it in a brokerage account. Invest it in a low-cost index fund like Vanguard's VOO. Potentially appreciate 7% per year and, so long as held for over one year, pay about 15% taxes on the capital gains, resulting in the purchasing power of $56,204 in 30 years.

4. Roth IRA

Put it in a Roth IRA. Invest it in a low-cost index fund like Vanguard's VOO. Potentially appreciate 7% per year and, so long as you hold it past 59 1/2 years old, pay zero taxes on any and all gains, resulting in the purchasing power of $76,122 in 30 years.

The choice is yours. Just know it's a $72,000 choice.

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