Are you interested in the quickest ways to double your money? If you are wondering how to double your money quickly, there are plenty of ideas out there. If you want to use your money to make money, you have to be willing to spend time or take on a bit of risk. In general, the faster you want to double your money, the more risk you will have to take on. On the other hand, if you are willing to wait a little longer, you may not have to take as much risk with your money.
So, how do you double your money? If you want to learn how to double $10K, take a look at a few of the most important points below, and do not hesitate to reach out to a professional who can help you.
A Few Quick Points To Note
Before diving into the details, there are a few quick points you need to keep in mind. They include:
- A classic approach to double your money is to invest your money in a diversified portfolio that contains stocks and bonds.
- If you do not want to take risks with your money, you should be able to double it safely over a period of years; however, if you want to double your money as quickly as possible, you may need to look at other ideas.
- If you want to double your money quickly, you will have to take on more risk; however, these speculative assets are not guaranteed to increase in value.
- You need to be honest with yourself about the total amount of risk tolerance you can take on. You do not want to let yourself be guided by greed and fear. You need to have a healthy amount of skepticism regarding get-rich-quick schemes, and you need to know yourself as well as the assets you are investing in.
With these important points in mind, it is time to take a closer look at some quick ways to double $10K.
1. Use an Investment Portfolio To Your Advantage
If you want to double your money as quickly as possible without taking on too much risk, you need to have a diversified investment portfolio at your disposal. You should have a solid portfolio that includes a variety of investment-grade bonds and solid blue-chip stocks. For example, one of the most reliable vehicles at your disposal is the S&P 500 Index.
This is the index that the vast majority of people use as a barometer for the economy. When this index does well, it is a sign that the economy is doing well. It contains hundreds of blue chip stocks that tend to grow at a decent rate, and they also pay out a variety of dividends.
In addition to these reliable stocks, you may want to take a look at bonds that provide a decent return as well, which will help you hedge your risk against the stock market.
When you are trying to figure out how long it will take you to double your money, you need to use the rule of 72. The interest rate your investments return, multiplied by the number of years it takes to double your money, should equal 72.
For example, if you expect your portfolio to return an average of 9 percent per year, which would be pretty aggressive, you should expect to double your money in about 8 years. While there is a significant amount of volatility in the stock market, you might want to take the classic approach of using a diversified investment portfolio of stocks and bonds to help you grow your assets.
2. Target Speculative Assets
There are plenty of safe ways for you to double your money, but if you have a tolerance for a lot of risk, you may want to consider speculative assets. Of course, the biggest risk with this option is that you can lose your money quickly; however, if you strike paydirt, you may be able to double your money in the blink of an eye.
There are plenty of speculative assets available. Some of the top options available include margin trading, options, penny stocks, and cryptocurrency. These assets are prone to wild swings, so you need to think carefully when you are deciding which of these approaches you want to take. This option also requires a tremendous amount of time, as you believe to keep a close eye on all of your Investments to figure out when to buy and sell.
This is a risky strategy, but if you are comfortable trading speculative assets, you may be able to generate a significant return on your investments.
3. Open an IRA
If you want to double your money, you need to take advantage of tax breaks when you can. One option is to open an IRA. An IRA is an investment retirement account. You can open a traditional IRA or a Roth IRA, and they differ in terms of tax benefits.
If you decide to open a traditional IRA, you can deduct the amount of money you invest in the IRA from your taxable income during the year in which you invest that money into the IRA. This can reduce your tax burden, helping you save money for retirement while also reducing the amount of money you owe in taxes.
If you decide to open a Roth IRA instead, you will have to pay taxes on the money that you invest in the Roth IRA right now, but you will not have to pay any taxes when you withdraw the money.
Because of the tax benefits you enjoy, you should be able to double your money relatively quickly. On the other hand, if you decide to invest in an IRA, you will not be able to touch the money until you are significantly older, so you need to make sure that you will not require that money in the near future.
4. Consider Investing in Real Estate
If you are looking for a way to diversify your investments even further, you may want to consider investing in real estate. This is another very traditional way to build wealth, but there are some significant barriers to consider. While there are lots of people who dream of owning one home, let alone multiple homes, housing prices have increased significantly during the past few years, making it very difficult for people to get into real estate.
There are other ways to invest in real estate, such as targeting real estate investment trusts. Usually shortened to REITs, these make it easier for people to invest in real estate with smaller amounts of money, but if you are investing smaller amounts of money, it will make it more difficult for you to generate a decent return.
The biggest advantage of investing in real estate is the leverage you can generate. Essentially, you can put a down payment on a rental property and ask the bank to provide you with a loan for the rest. Then, you will be using the bank's money to make more money, as all of the capital appreciation from the property is going to go into your pocket.
Investing in real estate also provides you with an opportunity to generate a consistent stream of passive income from your renters. Therefore, you will not only enjoy the capital appreciation of your property but also have access to a reliable stream of rental income. While there might be some barriers to overcome, you may want to consider investing in real estate.
5. Max Out Your 401K
Do not forget that you should also max out your 401K. This is a retirement plan that is generally sponsored by your employer. If you are willing to take money out of your paycheck and invest it in your retirement through your 401K, your employer should match the money you put into the plan. Some employers will match you dollar for dollar up to a specific amount, while other employers will match you 50 cents to the dollar up to an even higher amount.
You need to take advantage of this 401K for multiple reasons. First, you do not want to leave free money on the table, and if the employer is willing to match the amount of money you put in your 401K, you do not want to turn this money down. Second, if you invest that money in your 401K plan, you can deduct that money from your taxes, meaning that you do not have to pay taxes on that money during the year you invest that money in your 401K.
If you do not know the details of the 401K plan sponsored by your employer, you need to take a look at the guidelines and make sure you take full advantage of this opportunity.
6. Be a Contrarian
You may have heard that it is possible to have too much of a good thing, and that is certainly true when it comes to the stock market. Just because a lot of people are investing in something doesn't necessarily mean it is a good thing. In the stock market, when a lot of people invest in something, that asset could end up becoming overvalued. That means that the share price reflects that the company is worth significantly more money than it is.
Then, once people believe that a specific asset has become oversold, other people will start to sell that asset and get out, causing its value to plunge. You do not want to be the last one stuck holding the bag, as it means that you will also take the majority of the loss.
There are a variety of metrics you can use to value a company, and one option is the price-to-earnings ratio, usually shortened to PE. For example, if one company’s PE is significantly greater than the average PE of the industry, it could be a sign that the company is overvalued. Then, you might want to sell that company instead of buying it, meaning that you are going against the prevailing trend. That is the definition of being a contrarian.
Now, taking this approach requires a significant amount of risk tolerance, and you need to conduct a major amount of research if you want to figure out where other people are going wrong. It could provide you with an opportunity to make money quickly, but also requires a lot of risk.
7. Give Day Trading a Try
If you are really willing to get aggressive when you try to double your money, you may want to think about day trading. Essentially, you will purchase stocks and hold them for a relatively short amount of time, and then you will sell them when you feel like the stock is as high as it will go. There are some situations where you might only hold certain stocks for a few hours, and there are other situations where you might hold those stocks for a few days.
If you decide to try to day trade on the stock market, understand that this is a very risky proposition. It can be a challenge to predict what a stock is going to do in the near future, so there is always a chance that you could lose a significant amount of money. If you feel like you are able to do research to figure out when certain stocks are going to go up or down, you may be able to make money day trading. Just remember that this is a very risky option, so you need to think carefully before giving it a try.
8. Investing in Bonds and CDs
There are multiple ways to get to the same place, and some options will simply take you longer to get there. If you are not comfortable with the idea of losing your money, you may want to consider investing in lower-risk investment vehicles. Now, there is always a trade-off between returns and risk. If you do not want to take a lot of risk, then your money is not going to generate a significant amount of return.
Some of the safest investments include bonds and certificates of deposit (CD). If you buy a bond, you purchase a bond for a certain amount of money, and you agree to get a different amount of money at a certain point in the future. CDs are similar. If you decide to open a CD with a bank, you are not allowed to touch that money for a certain amount of time, but the bank will provide you with an annual interest rate on the money you have with them, and that amount is typically much higher than a savings account.
The returns on bonds and CDs are going to be significantly lower than the average return on the stock market, but it is also a safer option if you want to use your money to make money. It might take you a long time to double your money with this option, but it is less risky than the stock market.
9. Get a Side Hustle
Even though we have covered a lot of ways you can invest your money and double it, you can always double your money by earning extra money. Instead of using your existing money to make money, you are going to spend more of your time making extra money. There are plenty of interesting options available if you are looking for a side hustle, and you should tailor your side hustle to your skills and interests.
For example, if you love animals, you may want to consider getting a job helping people watch their dogs and cats. If you feel like you are good with kids, you may want to consider getting a side hustle babysitting. If you have a tremendous amount of knowledge in a specific area, you may want to consider tutoring people in that specific area.
Do not forget that you also need to consider the convenience of your side hustle. If you already have a full-time job, you may be looking for a side hustle that provides you with plenty of flexibility. There are some extra jobs that you can pick up that only require a computer and an internet connection, and you may have complete control over your work schedule with this type of side hustle. If you really want to double your money, consider getting an extra job on the side.
10. Consider Short Selling
Perhaps the riskiest way to double your money is through something called short selling. If you understand how to read the stock market appropriately, you may be able to make a tremendous amount of money in the blink of an eye; however, you can also lose money very quickly.
If you decide to short a stock, you essentially bet that the stock is going to go down instead of up. Take, for instance, Company A. Company A is currently selling for $1,000 a share. You think that the company is going to go down, so you borrow shares of Company A from a financial firm that is holding those shares. You sell those shares once you get them, but you agree to buy them back for Company A later.
When the share price drops to $900 per share, you buy the shares back for Company A, and you make $100 a profit per share. Now, this is a great way to make a significant amount of money, but what happens if the shares of Company A go up?
There is no telling how much money you can lose, and you could get margin called, meaning that you have to buy the shares back right now, costing you a tremendous amount of money.
Even if you are right, you may have to pay a lot of money in terms of taxes, fees, and commissions, which is why short selling is such a risky proposition.
If you really feel like something is going to go down, you may be able to make some extra money short-selling stocks, but it is very risky.
Think Carefully About the Best Ways To Double Your Money
Ultimately, there are plenty of options available if you are looking for a way to double your money, but you need to think carefully about what is right for you. You need to think about how quickly you want to double your money and the amount of risk you are willing to take on. The classic approach is right down the middle, using a nice mix of stocks and bonds to help you double your money in a reasonable amount of time. You need to make sure your strategy is aligned with your goals and interests.
