The 10 Best Investments in 2024 For Starting Your Investment Portfolio

Being able to manage your finances and control your daily/monthly budgets is a crucial skill, allowing you to maintain your independence and solvency, and build a foundation for your future. When you’ve successfully mastered your daily funds and are able to save some cash aside for a rainy day, you can start considering how to make your money work for you, not the other way around. 

Opening a standard savings account is a good idea, as is building up a good credit score. The next step to ensuring a stable financial future for you and your loved ones is to create investments for your funds to create financial bonds of stability.

What is the Best Investment Right Now?

If the word investing conjures up images of high-energy Wall Street executives wearing overpriced suits, backroom bonds deals. or sleazy business practices like those depicted in The Wolf of Wall Street, then don’t worry; there’s far more to it than that. Investments have become remarkably democratized, meaning that almost anyone with any budget can put their money and funds to work, to earn yields, profits, dividends, and more

If you’re wondering; ‘What should I invest in right now?’ then this is the article for you and your money. The international bonds markets look promising, the domestic economy is continuing to grow and with the new year just around the corner, it’s the perfect time to start an investment portfolio. 

There is always risk, and though this can be mitigated, you should never spend more money than what you’re willing to lose. That being said, remember; Nothing ventured, nothing gained.

The PocketGuard team has researched the 10 best investments for 2024 for you to consider for your money. We took a broad approach, seeking to find a wide range of options for your funds, to ensure you can use the markets to create the right long-term investment portfolio for you. We’ve got stocks, government bonds and private bonds, savings accounts and more

High-Yield Savings Accounts

We’ll start with something simple, as high-yield savings accounts represent a logical progression from something you should be doing with your money on a routine basis to an investment that makes your funds work for you. This type of account is an excellent core foundation of your investment portfolio as, like online savings accounts and cash management accounts, high-yield savings accounts offer superior interest rates compared to those available via conventional banking savings accounts, or checking accounts. Like conventional savings accounts, these offer interest rates to their clients and are sometimes also offered by institutions other than banks, like brokerage firms or bonds institutions

No investment is completely without risk, even government bonds, but if you’re looking for the safest of safe bets for your funds then high-yield savings accounts are for you. That’s because, in the United States, most high-yield savings accounts are Federal Deposit Insurance Corporation (FDIC) insured, meaning that if the bank that owns the account fails your money should be protected, just like with many bonds options.

High-yield savings accounts also offer a lot of flexibility, so if you’re looking to use your money as an investment for a specific goal, for example, a deposit on a house, this would be a good choice for your funds too. This also means that you can use this type of savings account as an emergency fund for large and unforeseen expenses, rather than something like a government bonds account.

If you do decide to set up a high-yield savings account, just make sure you’re using it as a long-term investment and not for daily banking, as you won’t be able to enjoy its full benefits. Also, while you will earn interest, it won’t have a particularly high yield long-term, so this is not a good option for you if you want something designed for a retirement fund.

Real Estate

The original, the classic, the time-immemorial investment—real estate has always offered plenty of rewards for those looking to invest their hard-earned money, and that maximum holds true today. If you’re looking for long-term investment (similarily to bonds) that could provide secure retirement funds or a better future for your children, then buying properties like apartments, houses, commercial infrastructure, etc. should provide you with what you need. However, real estate isn’t easy to invest in and the barrier to entry is high, there could be numerous market or government regulations to consider, and you need to be in it for the long haul.

The benefits of real estate easily explain why this has long been one of the most popular investments for peoples’ money. Its history spans well into the past and could be argued to be the very first form of investment in civilization Some of its most notable benefits include:

• Real estate is a reliable investment as, in contrast to the stock market which is known for its considerable volatility, real estate tends to be less susceptible to frequent market fluctuations, protecting your funds in the long run. In that sense, it’s more similar to bonds.
• You can use real estate to generate passive income, as rental properties typically yield a consistent monthly income, and property values tend to appreciate naturally, independent of any renovations or updates.
• Real estate is easy to finance. On average, people purchasing real estate borrow 75% to 94% of their investment acquisition cost, and the interest rates are often significantly lower than the anticipated rate of return on their funds, so you don’t need a lot of money as cash to start.

There are a number of crucial factors you need to consider before investing in real estate. It’s a huge commitment, acting as financial bonds on your future. As such, please consider the following:

• If you purchase real estate by borrowing money, you will be held liable for the loan. Changes in market conditions, interest rates, falling demand and funds, etc. could affect your property’s value and your ability to service the loans you took out.
• Many forms of investment have high levels of liquidity, meaning you can buy and sell within seconds. Real estate does not; it’s a long-term commitment that you can’t sell quickly at short notice without incurring a severe loss in funds.

Cryptocurrency

Cryptocurrencies can offer a significant return on investment but to describe the crypto market as unpredictable would be a major understatement. As such, if you want to invest your funds in cryptocurrencies like Bitcoin and Ethereum, we strongly recommend that you do your research on this investment option beforehand. There is a lot of misinformation about crypto out there, especially on social media, so make sure you verify the information that is presented to you.

Some of the benefits of cryptocurrency include:

• Bitcoin and many other cryptocurrencies have hard caps on the total number of coins that will ever be minted. This provides an excellent safeguard against inflation.
• It’s very simple to transfer funds using cryptocurrencies, which provides investors with a high degree of liquidity. Transactions involving your money can take just a few minutes.
• The profits that could potentially arise via cryptocurrency trading can be astronomical, and over the last decade, the total value of these investments has reached $2 trillion from essentially zero.

Some of the disadvantages of cryptocurrency include:

• Cryptocurrencies are supposed to be highly decentralized, whereas, in reality, ownership is highly concentrated. For example, 100 addresses hold roughly 15% of circulating bitcoin.
• Crypto investments have very high risks involved, and there are a number of coins that have lost all or nearly all of their value, including Terra, Solana, and AMP, leaving some investors broke with no money.
• There is no clear international framework for governing cryptocurrency, which further adds to their level of risk. As such there are more reliable long-term investment options.

Government Bonds

Government bonds are often associated with war bonds, which were used during the world wars for countries like the United States to generate vast amounts of money and funds to spend on armaments, personnel, ships, etc. The core purpose today remains the same, albeit with different aims; a government bond represents a debt security issued by a government to fulfill financial commitments and support public spending. These government bonds frequently offer periodic interest payments known as coupon payments, and as these investments are issued and backed by national governments, they are low-risk investments.

As such, similarly to high-yield savings accounts, government bonds are a great idea for first-time investors looking for a low-risk investment that will provide a small but steady amount of income via interest payments. There are several other advantages to investing in government bonds with your funds; for example, many governments also offer tax incentives to their citizens who invest in them. Government bonds are also frequently traded at high volumes, which means they can offer a considerable degree of liquidity as well.

Government bonds are a long-term investment for your money and that also means that their returns are not going to be special; they are solid, dependable, and not the stuff overnight fortunes are made of. Something else that is important to note, particularly in the current economic climate, is that government bonds can be significantly affected by rises in interest rates, which can lead to lower returns for your original funds. In a similar vein, rises in inflation may mean that any passive income earned from government bonds could lose its overall value, which could pose a threat to your original investment.

Corporate Bonds Funds

While bonds are often most associated with those issued by national governments, there are other institutions that can issue these sorts of funds too, including municipal bonds, agency bonds, and corporate private bonds. A corporate bond fund functions as a mutual fund investment, primarily allocating over 80% of its overall financial assets into corporate bonds. These bonds are issued by business entities to finance various short-term expenses, including working capital requirements, advertising, insurance premium payments, and similar needs.

Bond funds are particularly promising for investors seeking a diversified bond portfolio without the need to individually analyze and purchase specific bonds. As they don’t require a large amount of money to invest in either, procured bond funds are a good choice for people who are making their first investment and don’t have a lot of funds to invest, or want to invest cautiously. There is also a far wider range of corporate bond funds on offer to potential investors, and there are short-, medium-, and long-term bonds available, as well as some perpetual bonds options.

Corporate bond funds offer many of the same advantages as government bonds, namely that they represent a safe and long-term investment that will provide a modest amount of money as income over a set period. Corporate bonds offer more variety than their government counterparts, and they usually offer slightly higher returns as well as offering more choices. The same risks also apply, namely that any changes in interest rates would likely have an oversized impact on corporate bond funds, as could changes in inflation.

Growth Stocks

We could include stocks as a general catch-all category for investments; however, we thought it would be worth going into more detail as there are many different varieties of stocks. Growth stocks are well-known in the popular consciousness as they represent the archetypal image of stocks in the media – You invest money, its value skyrockets, and you become rich. 

Of course, it goes without saying that real-life investing is not the same as Hollywood fantasy. While growth stocks can lead to high returns on your original funds, there is also a higher level of risk, but it is also a classic example of high-return investments.

Growth stocks are often offered by tech companies when they enter the market, especially if they are identified as having a high potential for growth. The money raised by the growth stocks for their companies, which can be considerable, is frequently used as an investment in their business development. As such, the owners of growth stocks are unlikely to see dividends or real funds in the near or medium term; however, this does leave them with potentially very high-value stocks, increasing their net worth.

This means that there is a potential for a very high return on your initial investment in the long term. While we won’t discourage you from being ambitious with your investment portfolio, it’s very important that you do your research on the market in general and the company whose growth stocks you plan to purchase.

People often focus on the best-case scenario when buying stocks but it’s also really important to consider the worst-case scenario as well. During a bear market, a market in which share prices are falling (which encourages sales), the value of your growth stocks could be wiped out overnight.

Dividend Stock Funds

Dividend stock funds are similar to growth stocks and also represent a common perception of stock trading in the public mind. However, they have different aims and different methods of return on investment. 

Dividends represent portions of a company’s profit distributed to its shareholders, typically on a quarterly basis. As such, dividend stocks, unlike other stocks like those focused on growth, provide a cash payout, and funds consolidate these dividend-paying stocks into a convenient, single unit for purchase.

So, you buy your dividend stocks and wait for the money to roll in on a quarterly basis. That’s got to be the best way to invest money, right? It’s not that simple, of course, but let’s start with more of the benefits of this investment:

• They can be a source of regular income, provided that the company in which you hold shares is stable.
• Investing in dividend stocks helps investors to enjoy dual benefits such as value appreciation, as well as the aforementioned income.
• Like any stock, dividends are not taxed until the investor sells their shares, giving you plenty of breathing room for your tax returns.

These benefits highlight why dividend stock funds are so popular. Of course, there are risks and downsides, and some of the disadvantages of these funds include:

• As with all stocks, divided stock funds come with a degree of risk, with the worst-case scenario being that you lose your entire investment.
• If a company decides to change its dividend policy, it can cut the amount of money you receive from each payout, or eliminate them altogether.
• Certain industries and stock market sectors are likely to host a cluster of dividend stocks, which can expose concentrated investors to risk.

Small-cap Stocks

The third of our stock options, small-cap stocks are those stocks that belong to smaller-scale companies. Many major companies have started off with small-cap stocks, including internet giants like Google and Amazon, so this form of investment is all about finding the diamond in the rough. Companies that use small-cap stocks can range in size and include American pizza giant Papa John’s and the bank Axos Financial, so don’t make the mistake of thinking that small-caps are penny stocks.

One of the great advantages of small-cap stocks is that there’s huge potential for growth for your invested funds under the right circumstances. Should the company you invest in perform well there is potential for it to transition from small-cap status to a large-cap status over time. This investment strategy hinges on the anticipation that the company’s success will be reflected in the increased value of its shares.

The trade-off is that small-cap stocks as an investment are more prone to volatility as companies that grow too fast can often experience a retraction phase, which means the value of your shares could fall. Like other stock options you don’t have access to a lot of liquidity either, a problem made more acute by small-cap stocks lower market presence. That makes investors less willing to pay money for stocks they don’t know about.

Roth IRA

If you live in the United States, you have probably heard of the Roth IRA as it is one of the most well-known retirement investments in the country. It is frequently referenced in the media, as well as by financial experts, politicians, the list goes on. 

A Roth IRA is a distinct tax-beneficial individual retirement account where contributions are made with after-tax dollars. The key advantage of the Roth IRA is that it allows for tax-free growth of both contributions and earnings, with the ability to make tax-free withdrawals after reaching the age of 59½, provided that the account has been open for at least five years.

As you can imagine, the main purpose of a Roth IRA account is to invest funds for one’s retirement, though technically it’s not exactly an investment. It acts more like a protective barrier that is set around your funds, so it’s perfect for those who want to use their hard-earned money to help ensure a better future, similar to bonds. Out of all the possibilities listed in this article, Roth IRAs are probably the safest ‘investment’ you could go for.

There aren’t really any specific downsides or risks to investing in a Roth IRA; however, there are a number of factors that you need to consider before using this bonds like investment. For example, the maximum annual contribution that an individual can make to a Roth IRA in 2024 is $7,000, and for those aged 50 and older, the maximum annual investment is $8,000. Also, Roth IRAs fall under a different insurance category from conventional deposit accounts, which means that insurance coverage may differ from provider to provider, so make sure you do your research before opening an account.

Precious Metals

If you’re looking for an investment in something with tangible value, something that’s one of the best investment options for times of economic uncertainty, then going for precious metals might be the option for you. The most well-known example is gold, which has long been a popular option for people wanting a safe, long-term investment (similar to bonds), but you can also choose to put your money into other metals like silver.

Gold

Gold investing operates unusually compared to other market forces, as it’s affected more by consumer sentiment than supply and demand. There’s no shortage of gold, and demand remains fairly constant, so the price fluctuates when sentiment changes accordingly. Gold is also a long-term investment that isn’t affected by interest rates, so if you’re looking for something in which to store funds safely, then this might be a good bet for you.

Silver

This precious metal is more affected by market fluctuations as silver has industrial properties, so while it does have some long-term viability, silver investing is better suited to short-term trading in reaction to changing markets. This means that there’s potential for higher short-term returns on your investment, but also higher risk and less long-term viability. As such, silver is more suited to people with more bonds and trading experience.

Wondering What to Invest in Right Now? Start with PocketGuard

Bonds and stock funds, investments that come in the form of real estate or savings accounts—there’s a lot of choice on offer if you want to put your money into an investment portfolio. 

If you’re ready to start making long-term investment plans that put your money to work for a better future, then we’re sure one or a combination of the investments outlined above will help get you started. Just remember that you should always do your research before you launch an investment, be aware of the risks, and don’t commit to an investment you aren’t willing to lose.

Managing your money on a day-to-day basis is also an investment in your future. If you want to exercise greater control over your funds, then sign up for PocketGuard.

Our budgeting app represents an investment you can make in yourself today, a long-term investment that will help you build a better future for yourself and/or your dependents. If you want support with your money, funds, bonds, and more right now, then sign up for a free account or message us via our contact form, and we will be happy to assist you.