When it comes to building your savings, there are many ways to grow your wealth with the funds set aside. Whether you prefer to passively earn from online savings accounts, or take some risk by trying your hands at investing; it’s worth exploring your options to ensure you get more bang for your buck.
Here are some ways to earn more from your money.
- Money Markets and Certificate of Deposits (CDs):
Many online banks provide other options like certificates of deposit (CDs) and money markets that can help you earn a return on your money. Both products are similar to savings accounts, but each with its own pros and cons. CDs allow you to deposit money for a set period of time (1 to 10 years) in order to earn what is typically a higher interest rate. However, there’s a penalty fee if you withdraw the money before the set date, amounting to a few months worth of the interest you’ve collected. As for money markets, they function the same as a hybrid savings/checking account. Many banks would allow you to either write a check against the money market balance or use a debit card for the transaction. The drawback though, one needs a high initial deposit money along with maintaining daily minimum balance requirements to avoid penalty.
- Fintech For The Future: If you want a potentially bigger reward and are willing to take a few risks, there are a number of ways to get started in the world of investing. There are several tools and platforms from fintech companies that not only make investing easier, but also offer new alternatives to make money. One of the growing fintech inventions is peer to peer (P2P) lending. Simply put, approved borrowers can have their loans funded by investors, who then earn interest on the loan. Investing in P2P loans will likely become a more mainstream practice to help diversify investment portfolios.
- Developing Passive Income: Passive income can be defined as any money earned with little or no effort put in. Creating any stream of passive income requires an investment upfront. This could be in terms of time or money, but may lead to huge payoffs later. However, one needs to know that it isn’t a get-rich-quick scheme. Common forms of passive income include real estate investments or silent partnerships in businesses. Other creative ways include making YouTube videos or using affiliate marketing on your blog.
- Cards That Reward: While this may sound like it won’t help you earn money, but choosing a credit card that offers you rewards will definitely give you long term gains. Other than stretching every dollar you spend, the rewards should align with your lifestyle. For example, an avid traveller should look into a card with airline miles instead of shopping incentives.
While there exists a thousand ways one can make easy money from their extra savings, what’s more important is to be fully aware and pedantic about certain processes. There’s no simple answer – or a single way to do it. In fact, almost everyone can find at least one way to put their money to work.