Four ways to double your money, according to financial experts (2024)

There are many reasons why you might want to increase your money. You may be retiring soon, or you may have unexpected expenses or medical bills to pay. It may also be that your salary has not kept pace with inflation or the higher consumer prices we face in today's economy. Whatever it is, there are ways to do it – and in some cases even double your money.

It's all about choosing the right strategies. With traditionalsavings accountFor example, your options for growing your money are limited (the average APY is currently only 0.42%).

Fortunately, there are other options you can explore, including opening a high-yield savings account. You can now easily start earning more interest on your money.Get started with Discover now and lock in your terms from three months to ten years.

Four ways to double your money, according to financial experts

Do you want to double your money in the long or short term? Here are four ways to grow your money, according to financial experts.

Know your time horizon and follow the “Rule of 72”

The first step is to know how quickly you need to double your money. Is it two years, ten years, or just retirement a few decades later? Once you have that detail, follow what's called the rule of 72.

“The Rule of 72 will help determine how long it will take to double your money at a given rate of return,” says Michael Morgan, president of TBS Retirement Planning. "For example, on an investment that yields a 6% return, if you divide 72 by six, it will take 12 years to double your money. If you could average an annual return of 12% and divide 72 by 12, you would then be able to double your money in just six years.”

The Rule of 72 can help you determine what types of investments or financial products can help you achieve your goal. If you need to double your financial investment in 10 years, asavings accountwith an interest rate of, for example, 5%, it will not help you achieve your goals. You'll need something with a higher return (at least 7.2%) to reach the 10-year milestone.

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For short-term gains, you should opt for higher-risk investments

If you need to double your money within a fairly short timeline, old standards can e.gsavings accountor buying real estate is probably not for you. Instead, focus on higher-risk investments.

“How much risk you are willing to take matters,” says Morgan. "If you have an aggressive risk tolerance and look at riskier investments, you have the opportunity for higher profits, but also the risk of higher losses. The higher the risk, the higher the returns."

Higher risk options may include options such as cryptocurrency, day trading, or investing in companies and startups.

“There are no surefire ways to double your money quickly,” says Adam Sommers, principal planner and chief investment strategist at Sommers Financial Management. “Speculation in options, cryptocurrency or stocks has the potential to double your money quickly – but the downside is that when you speculate, your balance can just as easily go to zero. Speculation is more like gambling than investing.”

For long-term goals, take a well-rounded approach

If you have a long-term horizon, you should consider a more diversified, lower-risk approach. This is also usually what financial professionals recommend.

“Doubling your money in the long term is less about hitting home runs and more about playing small ball,” says James Allen, a CPA and founder of Billpin.

First, maximize the 401(k) that matches your employer's offer. As Allen explains, “There is literally free money on the table.”

So invest in the stock market, considerCD's, money market accounts andsavings accounts with high returnsand add somepropertyalso for the mixture. Both can help you diversify your portfolio and allow you to grow your wealth through different asset classes.

“Invest regularly in an S&P 500 index fund,” says Allen. "It's a diverse lineup of America's greatest sluggers, delivering an average annual return of about 10% over long seasons. With that batting average, you could potentially double your bankroll in about seven years."

Read more about your CD options here now.

Invest in yourself

Finally, invest in the more intangible things that can improve your career prospects and earning potential in the long term.

“The most important way to build wealth is to invest in yourself,” says Michael Wagner, COO of Omnia Family Wealth. “Depending on your degree and the field you're in, that may mean investing in your skills. Maybe that means going back to school and getting a master's degree or certification to really expand your ability to make money. enlarge."

You can also consider using money to start your own business or launch a product. Remember: this comes with some risk, so make sure you don't spend all your money on these ventures, especially if you don't have a healthy lifestyle.emergency fund.

In short

The right strategy for doubling your money depends on how quickly you need to do it, as well as your risk tolerance. If you are willing to take on more risk, you have the opportunity for more growth in a shorter time frame.

However, if you want to minimize the risk of loss – which financial experts recommend – it's best to take a long-term approach with a diversified mix of investments and strategies.

“Doubling your money requires a balanced and disciplined approach to investing, with an emphasis on diversified, long-term strategies,” says Joseph Catanzaro, financial advisor at Oak & Stone Capital Advisors. "While quick profits are possible with higher-risk options, the potential for significant losses makes them less suitable for most investors. Always consider your risk tolerance and financial goals before pursuing any investment strategy."