5 Best Places to Put $1,000 Right Now

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Even $1,000 can grow into much more if you put it to work. Here are a few smart places to put $1,000 today. [[{“value”:”

The best place to put money will depend a lot on your own circumstances. If the money is something you need access to in the future, that will dictate a lot about what you do with it now.

On the other hand, if your only goal with this $1,000 is to get the best return, that’s a different decision. And so is what to do if you have debts or bills.

Here are a few options to consider for your $1,000.

1. Pay off any high-interest debt

The average credit card charges more than 22% interest. You’ll be hard-pressed to find any investment that gives you a 22% return.

Ergo, if you have high-interest debt, the best return on investment is to pay off that debt.

If you have debts with lower interest rates, then you may want to consider your options. Folks with those magical 3% (or lower) mortgages, for instance, could get a better return with a competitive high-yield savings account.

2. Stash it in a high-yield savings account

If you want to set and forget your savings (without tying it up), a high-yield savings account is the place to go. The best savings accounts pay around 5% APY right now, which is a pretty solid return for what is generally zero risk.

I consider savings accounts to be the baseline for the question of, “Is this a good return?” If I can get a higher return from a savings account than another option, that’s where I’d rather put my money.

Oh, and don’t just put it into any old savings account (especially at a brick-and-mortar bank). The national average savings rate is just 0.45%, so be sure you’re getting a competitive rate before tucking away your money.

3. Build emergency savings in a money market account

There is one universal truth we must all acknowledge: life’s gonna life. No matter what else, you can count on something unexpected occuring, probably at a terrible time, and it’s likely going to cost you money.

Emergency funds are that money. They make it easier to roll with the punches without totally losing your marbles.

The best high-yield money market accounts are comparable to savings accounts on rates, except money markets have ATM cards and paper checks. This makes your money accessible in a hurry whenever life, you know, happens. (C’est la vie, mes amies.)

4. Grow it with a long-term CD

If you don’t need access to your $1,000 anytime soon, you could put it into a long-term CD. Rates on CDs are locked in until it matures, so you could lock in today’s rates for years with the right CD.

Keep in mind that once you put the money in the CD, you really need to leave that money alone until the CD matures. Most CDs have steep fees (sometimes even including part of your principal) for withdrawing your principal early.

5. Start — or add to — a retirement account

If you’re sure you won’t need that money and you’d like to put it toward the future, consider a retirement account. Most people (66% according to study by The Motley Fool) feel behind on saving for retirement, so this could be a good time to add to — or start — your retirement fund.

Of everything on this list, this is the one that’s hardest to “take back.” In other words, only put your money here if you’re positive you won’t need it for anything else anytime soon. Never invest your emergency fund.

Keep your money working for you

The key to wealth is turning your money into more money. There are a ton of ways to do this, even with only $1,000.

As I noted above, the best option for your money will depend entirely on your own circumstances. Consider all of your options before making any big decisions about where to put your savings.

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