8 Best Ways To Invest $1,000 in 2023

Investment

8 Best Ways To Invest $1,000 in 2023

Published

2 months ago

April 13, 2023

Megan Johnson

You have $1,000 saved and you’re trying to figure out what to do with it. It would be a significant amount of money to splurge and spend all at once — but is it enough to invest? The truth is, $1,000 is a great place to start investing and can make a difference in your financial health.

Below, CNBC Select suggests several ways you can invest $1,000 and explains how to decide which option may work best for you. Some investments might offer greater returns, but they also come with greater risk. If your financial safety net allows for this risk, such investments are worth considering. If not, you can use your $1,000 to correct that.

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1. Build an emergency fund

An emergency fund is crucial to your financial health. When you’re facing unexpected expenses, such as job loss, medical expenses or surprise home or car repairs, your emergency fund will keep you from straining your budget or going into debt.

Experts generally recommend having between three and six months’ worth of living expenses in your emergency fund. If you’re not quite there, $1,000 can go a long way.

A good place to park your emergency fund is a high-yield savings account. This way, you’ll get guaranteed returns in the form of compound interest. Some high-yield savings accounts are now offering around a 5% annual percentage yield (APY) — a return we haven’t seen since the 1990s. Plus, these accounts are usually FDIC-insured so they are virtually risk-free.

Here are a few high-yield savings accounts we recommend:

LendingClub High-Yield Savings

LendingClub Bank, N.A., Member FDIC

Annual Percentage Yield (APY)
Minimum balance

No minimum balance requirement after $100.00 to open the account
Monthly fee
Maximum transactions
Excessive transactions fee
Overdraft fees
Offer checking account?
Offer ATM card?

UFB Preferred Savings

UFB Preferred Savings is a Member FDIC.

Annual Percentage Yield (APY)

Earn up to 5.02% APY*
Minimum balance
Monthly fee
Maximum transactions

No max number of transactions; Max transfer amounts may apply
Excessive transactions fee
Overdraft fees

Overdraft fees may be charged, according to the terms, but a specific amount is not specified; overdraft protection service available
Offer checking account?
Offer ATM card?

Marcus by Goldman Sachs High Yield Online Savings

Goldman Sachs Bank USA is a Member FDIC.

Annual Percentage Yield (APY)
Minimum balance
Monthly fee
Maximum transactions

At this time, there is no limit to the number of withdrawals or transfers you can make from your online savings account
Excessive transactions fee
Overdraft fee
Offer checking account?
Offer ATM card?

Terms apply.

2. Pay down debt

If you have credit card debt, paying it off should be your priority, especially in a high-rate environment.

Let’s say you have a $1,000 balance on a credit card with a 20% APR and only make a minimum payment of $25 each month. The balance will take you 67 months to pay off and you’ll lose $661 to interest. Or you could pay the whole balance off instead and not worry about interest charges at all.

If you owe considerably more, you may feel as though $1,000 would barely make a dent in your card debt. In that case, you may also want to look into a 0% APR credit card or debt consolidation loan to save on interest charges. The Wells Fargo Reflect® Card, for example, has a 0% intro APR for up to 21 months from account opening on purchases and qualifying balance transfers (then 17.74% to 29.74% variable APR).

Wells Fargo Reflect® Card

On Wells Fargo’s secure site

Rewards
Welcome bonus
Annual fee
Intro APR

0% intro APR for 18 months from account opening on purchases and qualifying balance transfers. Intro APR extension for 3 months with on-time minimum payments during the intro period. 17.74% to 29.74% variable APR thereafter
Regular APR

17.74% to 29.74% variable APR on purchases and balance transfers
Balance transfer fee

Introductory fee of 3% for 120 days from account opening, then up to 5% ($5 minimum)
Foreign transaction fee
Credit needed

Excellent/Good

3. Put it in a retirement plan

Another aspect of your financial life you want to cover is your retirement funds. If your employer offers a 401(k) match, you may be missing out if you’re not taking full advantage of it. Further, it’s good practice to save 15% of your annual income for retirement (including any contributions by your employer). If that seems like a lofty goal to you at the moment, contributing $1,000 can definitely make a difference.

If you don’t have an employer-sponsored retirement plan, you can always invest in an individual retirement account (IRA) instead. The IRA contribution limit for 2023 is $6,500, or $7,500 if you’re 50 or older.

CNBC Select picked Charles Schwab IRA as the best IRA account. If you’re just beginning to invest, Fidelity Investments IRA can be an excellent choice.

Charles Schwab

Minimum deposit and balance

Minimum deposit and balance requirements may vary depending on the investment vehicle selected. No account minimum for active investing through Schwab One^® Brokerage Account. Automated investing through Schwab Intelligent Portfolios^® requires a $5,000 minimum deposit
Fees

Fees may vary depending on the investment vehicle selected. Schwab One^® Brokerage Account has no account fees, $0 commission fees for stock and ETF trades, $0 transaction fees for over 4,000 mutual funds and a $0.65 fee per options contract
Bonus
Investment vehicles

Robo-advisor: Schwab Intelligent Portfolios^® and Schwab Intelligent Portfolios Premium™ IRA: Charles Schwab Traditional, Roth, Rollover, Inherited and Custodial IRAs; plus, a Personal Choice Retirement Account^® (PCRA) Brokerage and trading: Schwab One^® Brokerage Account, Brokerage Account + Specialized Platforms and Support for Trading, Schwab Global Account™ and Schwab Organization Account
Investment options

Stocks, bonds, mutual funds, CDs and ETFs
Educational resources

Extensive retirement planning tools

Terms apply.

Fidelity Investments

Minimum deposit and balance

Minimum deposit and balance requirements may vary depending on the investment vehicle selected. No minimum to open a Fidelity Go account, but minimum $10 balance for robo-advisor to start investing. Minimum $25,000 balance for Fidelity Personalized Planning & Advice
Fees

Fees may vary depending on the investment vehicle selected. Zero commission fees for stock, ETF, options trades and some mutual funds; zero transaction fees for over 3,400 mutual funds; $0.65 per options contract. Fidelity Go is free for balances under $10,000 (after, $3 per month for balances between $10,000 and $49,999; 0.35% for balances over $50,000). Fidelity Personalized Planning & Advice has a 0.50% advisory fee
Bonus

Find special offers here
Investment vehicles

Robo-advisor: Fidelity Go® and Fidelity^® Personalized Planning & Advice IRA: Fidelity Investments Traditional, Roth and Rollover IRAs Brokerage and trading: Fidelity Investments Trading Other: Fidelity Investments 529 College Savings; Fidelity HSA^®
Investment options

Stocks, bonds, ETFs, mutual funds, CDs, options and fractional shares
Educational resources

Extensive tools and industry-leading, in-depth research from 20-plus independent providers

Terms apply.

4. Open a certificate of deposit (CD)

Let’s say your emergency fund is in good shape, you’re on track to contributing to your retirement plan and you have no high-interest debt. Yet, you’d rather not take on risk when it comes to your money.

In this case, you might want to look into certificates of deposit (CDs). This type of deposit account earns a fixed interest rate for a specific amount of time on the funds you deposit when you open an account. The term lengths typically range between three months and five years. Longer terms tend to come with higher APYs but with a traditional CD, you can’t withdraw your money before the end of the term. Otherwise, you’ll generally have to pay an early withdrawal penalty.

Interest rates on CDs are often higher than those on regular savings accounts. This means you might get better returns at the trade-off of no easy access to your cash until the maturity date. But if you already have an emergency fund parked in a more accessible account, putting extra money aside in a CD can be a good move.

At the time of writing, the following accounts are offering some of the best CD rates:

Synchrony Bank CD

Synchrony Bank is a Member FDIC.

Annual Percentage Yield (APY)

For 3-month CD: 2.25% APY; higher APYs may be available for longer terms, click Learn More for details
Minimum balance
Monthly fee
Early withdrawal penalty fee

For 3-month CD: 90 days interest, whether or not earned

Terms apply.

APYs are subject to change at any time without notice. Offers apply to personal accounts only. Fees may reduce earnings. For CD accounts, a penalty may be imposed for early withdrawals. After maturity, if your CD rolls over, you will earn the offered rate of interest for your CD type in effect at that time.

CFG Community Bank CD

Capital Funding Group is a Member FDIC.

Annual Percentage Yield (APY)

For 3-year CD: 4.60% APY; higher APYs may be available for longer terms, click Learn More for details
Minimum balance

$500 to open and start earning interest
Monthly fee
Early withdrawal penalty fee

For 3-year CD: Subject to a penalty fee; Withdrawing within six days of account opening will cost you a 7-day interest penalty

Ally Bank High Yield CD

Ally Bank is a Member FDIC.

Annual Percentage Yield (APY)

For 5-year CD: 4.25% APY; higher APYs may be available for other terms, click Learn More for details
Minimum balance
Monthly fee
Early withdrawal penalty fee

For 5-year CD (or any CD that is 49 months or longer): Equal to 150 days of interest

Terms apply.

5. Invest in money market funds

Kenneth Chavis IV, CFP and senior wealth manager at LourdMurray, suggests money market funds “for those who are not comfortable with investment risk but want to earn some interest on their money.”

Money market funds (MMFs) invest in lower-risk debt securities, such as U.S. Treasury bills and commercial paper, and are considered some of the safest investments. MMFs pay monthly dividends. The yield is typically close to or a little higher than on bank savings accounts. This is also a highly liquid option — you can withdraw the money you’ve invested at any time.

You can buy money market funds from a bank, fund provider such as Fidelity Investments or Vanguard or by opening a brokerage account.

Fidelity

Fees/commissions

$0 for stocks, ETFs, options and some mutual funds
Account minimum
Investment options

Stocks, bonds, fractional shares, ETFs, mutual funds, options

Vanguard

Fees/commissions
Account minimum
Investment options

Stocks, bonds, ETFs, mutual funds, options, CDs

6. Buy treasury bills

Speaking of Treasury bills, they’re also a low-risk investment since they’re backed by the government and give you a guaranteed return over a set period of time.

“You will get a nice guaranteed rate dependent on how long the maturity is (assuming you hold until maturity) and you will not owe state income tax on the interest,” Chavis says.

Since there’s a maturity period, this option provides less liquidity than money market funds. At the same time, the term can be very short — from just a few days to a year.

You can buy Treasury bills directly from the TreasuryDirect website or go through a broker like Charles Schwab or Fidelity.

Charles Schwab

Minimum deposit and balance

Minimum deposit and balance requirements may vary depending on the investment vehicle selected. No account minimum for active investing through Schwab One^® Brokerage Account. Automated investing through Schwab Intelligent Portfolios^® requires a $5,000 minimum deposit
Fees

Fees may vary depending on the investment vehicle selected. Schwab One^® Brokerage Account has no account fees, $0 commission fees for stock and ETF trades, $0 transaction fees for over 4,000 mutual funds and a $0.65 fee per options contract
Bonus
Investment vehicles

Robo-advisor: Schwab Intelligent Portfolios^® and Schwab Intelligent Portfolios Premium™ IRA: Charles Schwab Traditional, Roth, Rollover, Inherited and Custodial IRAs; plus, a Personal Choice Retirement Account^® (PCRA) Brokerage and trading: Schwab One^® Brokerage Account, Brokerage Account + Specialized Platforms and Support for Trading, Schwab Global Account™ and Schwab Organization Account
Investment options

Stocks, bonds, mutual funds, CDs and ETFs
Educational resources

Extensive retirement planning tools

Terms apply.

7. Invest in stocks

If you don’t mind parting with your $1,000 for a while for a chance of higher returns (at higher risk), consider investing in the stock market.

Chavis suggests going with stock index funds. These investment funds follow a benchmark index, such as the Nasdaq 100 or the S&P 500. The money you put in such a fund is then invested in all the companies that make up the index, which allows for a more diverse portfolio than you’d get buying individual stocks.

“This is a great option for those with a long-time horizon,” Chavis says. “You will get good stock market diversification, low costs and likely no trade fees.”

You can invest in an index fund if you have a brokerage account, a traditional IRA or a Roth IRA.

Many of the best stock trading platforms don’t charge commission fees, including TD Ameritrade, Ally Invest, E*TRADE, Vanguard, Charles Schwab and Fidelity. Or if you want a simpler interface and trading platform, consider investing apps like Robinhood and Webull. Both apps also provide access to fractional shares which allow you to purchase a portion of a stock that’s less than one full share. Doing so can help you diversify your portfolio with less money.

Robinhood

On Robinhood’s secure site

Minimum deposit and balance

Minimum deposit and balance requirements may vary depending on the investment vehicle selected. No minimum required to open an account or to start investing
Fees

Fees may vary depending on the investment vehicle selected. Commission-free trading; regulatory transaction fees and trading activity fees may apply
Bonus

Robinhood will add 1 share of free stock to your brokerage account when you link your bank account and fulfill the conditions in your promotion (you’ll be able to keep the stock or sell it after 2 trading days)
Investment vehicles
Investment options

Stocks, ETFs, options trading, fractional shares, IPOs, plus certain cryptocurrencies through Robinhood Crypto (depending on where you live)
Educational resources

Terms apply.

Webull

Minimum deposit and balance

Minimum deposit and balance requirements may vary depending on the investment vehicle selected. No minimum required to open an account or to start investing
Fees

Fees may vary depending on the investment vehicle selected. Commission-free trading; regulatory transaction fees and trading activity fees may apply
Bonus

Get 5 free stocks when you open and fund a new account: Sign up with Webull to get your 2 free stocks, each valued up to $300, and deposit any amount to receive 3 free stocks, each valued up to $3,000
Investment vehicles

Brokerage account: Webull commission-free investing IRA: Traditional, Roth, Rollover IRAs
Investment options

Stocks, ETFs, options trading, fractional shares, IPOs, ADRs, plus certain cryptocurrencies through Webull Crypto
Educational resources

Terms apply.

8. Use a robo-advisor

If you’re interested in investing but want a more hands-off approach, you can use a robo-advisor which will automatically invest in several index funds and ETFs based on your goals and risk tolerance. These accounts typically have low or no minimum opening deposits and have much more affordable management advisory fees than traditional financial advisors. CNBC Select suggests Betterment and Wealthfront as our top picks for the best robo-advisors.

Betterment

Minimum deposit and balance

Minimum deposit and balance requirements may vary depending on the investment vehicle selected. For example, Betterment doesn’t require clients to maintain a minimum investment account balance, but there is a ACH deposit minimum of $10. Premium Investing requires a $100,000 minimum balance.
Fees

Fees may vary depending on the investment vehicle selected. For Betterment Digital Investing, 0.25% of your fund balance as an annual account fee; Premium Investing has a 0.40% annual fee
Bonus

Up to $5,000 managed free for a year with a qualifying deposit within 45 days of signup. Valid only for new individual investment accounts with Betterment LLC
Investment vehicles
Investment options

Stocks, bonds, ETFs and cash
Educational resources

Betterment offers retirement and other education materials

Terms apply. Does not apply to crypto asset portfolios.

Wealthfront

Minimum deposit and balance

Minimum deposit and balance requirements may vary depending on the investment vehicle selected. $500 minimum deposit for investment accounts
Fees

Fees may vary depending on the investment vehicle selected. Zero account, transfer, trading or commission fees (fund ratios may apply). Wealthfront annual management advisory fee is 0.25% of your account balance
Bonus
Investment vehicles
Investment options

Stocks, bonds, ETFs and cash. Additional asset classes to your portfolio include real estate, natural resources and dividend stocks
Educational resources

Offers free financial planning for college planning, retirement and homebuying

Terms apply.

Compare investing resources

Bottom line

You don’t need to wait to have thousands of dollars to start investing. Even just $1,000 can go a long way if you make it benefit your financial well-being. Whether you’re at the very beginning of your financial journey, paying off debt and adding to your emergency fund or you’re ready to start investing in stocks, even a small initial contribution can help you lay the foundation for a prosperous future.

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Investment

Investment grade will boost realty

Published

3 hours ago

June 4, 2023

Megan Johnson

The local property market stands to reap significant benefits, both short-term and long-term, from a likely credit rating upgrade to investment level for Greece.

Industry executives say that would be a very positive development, as, after 14 years, the Greek real estate market will return to the “elite” of investment destinations and it will become easier to attract foreign investment groups and funds.

“There is an objective problem right now regarding the implementation of investments by a number of institutional investors, as there are rules that prohibit the placement of funds in countries below investment grade. In other words, even if there was an investment opportunity and they were willing to take the risk, such an investment would be cut off by the investment committee of the respective group, because it is not allowed to invest in countries that do not have a positive credit rating,” Tassos Kotzanastassis, ULI global management committee executive and CEO of international real estate investment management company 8G Group, tells Kathimerini.

Securing investment grade means the Greek property market will get back on the “radar” of large institutional investors and state groups that have a long-term investment horizon. This is a development that contradicts speculative moves by a portion of institutions that have been placed in Greece, with a purely short-term horizon, aiming to secure a quick profit and exit from the country.

However, as Kotzanastassis warns, new investments from large foreign funds should not be expected, at least not immediately. “In this period, at the international level, there is significant uncertainty and investors appear restrained. Many are looking for investment opportunities in the form of distressed assets,” he emphasizes.

One of the market’s perennial problems is it is shallow, so it is difficult to create economies of scale that maximize the return on an investment. Another key point is that all foreign investors of this scope are looking for properties with green characteristics, in the context of the ESG policy they follow. Such properties are still rare in this market, constituting a very small minority in relation to the total stock.

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Investment

Fidelity has cut Reddit valuation by 41% since 2021 investment

Published

15 hours ago

June 4, 2023

Megan Johnson

Fidelity, the lead investor in Reddit’s most recent funding round in 2021, has slashed the estimated worth of its equity stake in the popular social media platform by 41% since the investment.

Fidelity Blue Chip Growth Fund’s stake in Reddit was valued at $16.6 million as of April 28, according to the fund’s monthly disclosure released over the weekend. That’s down 41.1% cumulatively since August 2021 when the asset manager spent $28.2 million to acquire the Reddit shares, according to disclosures the firm has made in its annual and semi-annual reports.

Reddit was valued at $10 billion when the social media giant attracted funds in August 2021. Fidelity — which has marked down its stakes in many startups including Stripe and Reddit in recent quarters — also slashed the value of its Twitter stake, it disclosed in the filing, valuing Elon Musk’s firm at about $15 billion.

The substantial markdown of Reddit’s value by Fidelity predominantly occurred by the previous year. Nevertheless, it merits pointing out that Fidelity has persistently implemented minor reductions in the worth of Reddit’s shares in the ensuing months. Fidelity, also an investor in Indian startups such as Meesho and Pine Labs, has effected considerably less dramatic valuation cuts in these holdings in the past two years.

Reddit declined to comment.

This devaluation, part of a broader trend that has hit a variety of growth stage startups across the globe in the past year, raises uncertainties about whether Reddit will maintain its initial intent to reportedly go public at a valuation around $15 billion.

Reddit, which has raised over $1 billion to date, counts Sequoia Capital and Andreessen Horowitz among its backers. The firm was valued at as high as $15 billion in secondary markets late 2021, according to people familiar with the matter.

The current wave of valuation cutbacks sheds new light on the impact of deteriorating worldwide economic conditions on fledgling startups. Despite the diminished funding activities for startups globally over the past year, valuations of numerous larger startups have stayed constant.

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Investment

First Nations Technical Institute receives $3.5 million investment

Published

16 hours ago

June 4, 2023

Megan Johnson

The Federal Economic Development Agency for Southern Ontario is investing $3.5 million in the First Nations Technical Institute in Tyendinaga Mohawk Territory.

The funding is planned to be used as part of the aviation recovery plan, after a disastrous 2022 fire destroyed a hangar and an entire fleet of planes.

Part of the funds is also going to support the institute’s green energy initiative, by developing solar panels and battery storage intended to power their buildings and offset greenhouse gas emissions.

Suzanne Brant, President of the First Nations Technical Institute, thanked the government of Canada for their help in recovering after the incident.

“FTNI is grateful that the Government of Canada is investing in Indigenous initiatives in
our region, providing benefits to Indigenous learners and communities across Ontario
and Canada,” said Brant.

Brant also applauded FedDev Ontario‘s decision to launch a support team with dedicated resources to help indigenous businesses in southern Ontario. The new task force is connecting with indigenous lead businesses and has a new web page to show what resources are available to help them.

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