You can invest in individual companies by buying individual stocks. You can also purchase stocks by investing in vehicles like index funds or ETFs etc, that aggregate the stocks of several different companies.
Investing has the potential to generate much higher returns than savings accounts, but that benefit comes with risk, especially over shorter time frames. If you are saving up for a short-term goal and will need to withdraw the funds in the near future, you’re probably better off parking the money in a savings account.
But in order to be a millionaire via investing in 15 years, you’d only have to invest $43,000 per year (assuming a 6% real rate of return, which accounts for inflation).
Here are 8 solid ways to get started with investing 500 dollars!
All have higher risks and potentially higher returns than savings products. Over many decades, the investment that has provided the highest average rate of return has been stocks. But there are no guarantees of profits when you buy stock, which makes stock one of the most risky investments.
Supplementing your full-time pay by developing multiple income streams is another way to become a millionaire in five years or less. Starting a side hustle, picking up a part-time job or creating a home-based business are just a few ways to generate more money.