8 Best Ways to Invest $2,000 to $3,000 Dollars in March 2024 (2024)

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So you just got a small windfall. Maybe your tax return was slightly more than expected. Maybe you got a bonus for being the amazing person you are.

Perhaps you just won the lottery. Not !!THE LOTTERY!! mind you, but the lottery.

Whatever the case, you want to know the best way to invest 2k, and a 75” 4K TV doesn’t float your boat.

What about investing?That’s a great option! But with the many investing options available, deciding how to invest $2000 can be a little overwhelming.

Don’t worry — I’m here to help. Keep reading as I guide you through how to invest 2000 dollars.

At-a-Glance: The Best Platforms for Investing 2K

The 8 Best Ways to Invest $2000 in 2024

As mentioned, there are many, many ways to spend or invest that $2000. We’re not going for quantity — we’re going for quality. Here are 8 of the best ways of how to invest 2000 dollars (with a few bonus options, too):

(Note: Thinking bigger, or thinking ahead? You might be interested in our list of the top platforms to invest 50K.)

1. Invest in Alternative Assets

You thought I was going to say invest in stocks first, right? We’ll get to that. But let’s start with something a little different.

Investments don’t have to involve stocks, bonds, or other securities. If you put money into it expecting a return, it’s an investment. This can mean art, wine, collectibles (sports or otherwise), and whatever else you might think of that other people might want.

The risks can vary greatly, and knowing that some of these assets are volatile, but also knowing that many of these alternative assets aren’t affected nearly as much by the ups and downs in the normal markets. Are you afraid that the market will plunge tomorrow and fearful of how to invest 3,000 dollars? Fine art doesn’t really care about the plunge in the same way a stock like Tesla (NASDAQ: TSLA) might. Fine art also holds up well during times of high inflation:

As for a platform? One of our favorites is Masterworks, which allows you to become a fine art investor for a fraction of the price of buying a Van Gogh.

Masterworks makes it easy to invest in fine art for all investors — and you can gain access to big names in the art world, like Banksy, Monet, and Warhol. You can buy shares of ownership in these art pieces and realize the appreciation once it is sold.

Here’s an impressive stat: Every one of Masterworks’ 13 exits has returned a profit to investors, with recent exits delivering net annualized returns of 17.8%, 21.5%, and 27.3%.

2. Invest in Stocks and Funds

Stocks and funds are the first things most people think of when discussing investing, even when considering how to invest 2k.Some would say they’re the default investment method.

While I wouldn’t go that far (more on other options in a bit), stocks and funds are a clear way to get into investing, and for many, it’s the best way to invest 2k.

Historically, the S&P 500 Indexhas averaged a return of 11.29%, down to 7-8 percent if you adjust for inflation. If you reinvest any dividends you make (and you probably should), that return is increased further.

And $2,000-$3,000 is a perfect amount to get started with.You can set up a brokerage account today, deposit the money, and get started. Yet I wouldn’t recommend starting out just like that.

Instead, try using a more dedicated platform that will support your investing efforts. eToro is a great platform to get started. They have a great deal of information available to users, have a CopyTraderprogram that allows you to automatically copy the trades of top investors, and have access to other asset classes should you want to diversify later on.

You can check out eToro here.For more information on them, check out our piece on the top stock market trading apps.

Need a Little More Help Investing?

Investing in stocks and funds can be a little time-consuming, and you might not want to worry about it all that much. If you’re just contributing regularly and checking occasionally, you might want to try out automated investing with M1 Finance. You can set rules, set up a regular contribution, and then let it work. It will know how to invest 3k, so you don’t have to worry.

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3. Invest in Small Businesses

You could go out on Main Street and start asking questions, but that might not be the best use of your time. I hate to say it, but your friend’s “Burgers by the Bucket” food truck isn’t going to take off, regardless of how much you invest in it.

That is not to say that investing in a small business is not an option that can work for you. Investing in a small business is one of the ways to get the highest return for your $2000. Shares in large corporations will typically only go so far and you might not be sure about the returns. A good small business still has tons of room for growth, and you’d get in on the ground floor (assuming it works out).

You don’t need special venture capitalist or angel investor training to invest in a small business. It helps if you know how businesses work and what might be more likely to succeed and return on your investment, but platforms and other people can help with this.

While we always recommend Equitybeeto accredited investors as a great platform for investing in private companies, with $2K, you may not fall into that category. Happily, there’s an accessible platform for investing in small businesses that’s available to everyone — Mainvest.

Mainvest is one such platform, giving you a clearer idea of what money might be used.

And it’s not just startups that you can invest in. You might instead help to invest in a successful business, open their fourth location or get new equipment to increase production.

4. Invest in Yourself

It might sound like a meme or cliche,but what about investing in yourself?Your skills heavily determine your income, whether hard skills or soft skills. And while I don’t know how to invest $3000 to get another degree, you can get courses, take a class, and try out for certifications with that money.

It doesn’t even need to be related to your career.

Think of this one example. If you decide the best way to invest 2k is on cooking classes and dedicate the time to learning, you’ll be able to do a lot better than you might think by the end of it. Even for $100 per hour of lessons (and that’s fancy), that’s 20 hours of dedicated instruction.

You’ll want to go out to eat less after that, be able to eat happier and healthier, and that benefit will spread to other areas of your life. I’m sure your family will appreciate it, too.

If you’re looking for a simple, cheap, and effective option that has stood the test of time,there are always books. Having a nice read on a Sunday will cost $10 or so ($12 with some nice tea). If you read a book to improve yourself weekly (and that’s a lot), that $2000 will last more than three years (tea included).

Alternatively, have you considered a new bed and mattress? How much better would you be able to do at work and at life if you got a great night’s sleep every night? What about just a better pillow?The possibilities are endless.

One platform you should consider to improve yourself is Skillshare, which has courses on practically everything under the sun (and a few specifically about the sun, I’m sure).Want to build a skill for your career? There’ll be something to help on Skillshare.

Best of all, you probably don’t need to spend $2,000-$3,000 on Skillshare. (But if you did, you’d learn alot.)

5. Invest in Real Estate

When you think of real estate, you might think of huge complexes, massive developments, full homes, and obscure properties.

And when you think about real estate in the context of how to invest 2000 dollars, you might think, “What am I going to get, a haunted barn in the middle of Wyoming?”

Turns out you can’t get that. Have you seen the price of scrap wood (or land) these days?

Yet thanks to modern technology and apps, you don’t need to buy the whole (haunted) farm anymore.

Instead, you can crowdfund real estate as an investment using one of several apps.

Fundrise is a great way to invest in real estate, with the funding getting crowdsourced among multiple investors. And property management is not your problem.

Investors in real estate on Fundrise got a 5.40% return on their investment in 2022, and paid 1% in annual fees.That’s an ok return if you’re looking to diversify, and unlike some options, you’re very unlikely to lose all of your $2,000. The real estate market might expand and contract, but it’s not going to go away completely.

Fundrise also has a minimum investment of $10. Some portfolio options might be blocked off if you’re looking for maximum options for where to invest 2000 dollars, but you will still have plenty of property choices.

6. Set Up a High-Yield Savings Account

Everyone needs a good emergency fund. Having just a couple of thousand dollars or a month’s worth of expenses can be a huge relief should an unexpected expense or problem occur. In truth, before anything else, you should ensure you have one.

The average rate of return for a big bank savings account is abysmal, at less than 0.15%. With that rate, you might earn an extra bag of chips at the end of the year with your $2000.

With high-yield savings accounts, you can often get an annual return of 5% for absolutely no risk at all (any account worth its salt will be FDIC-insured.

M1 Finance offers a 5.00% APY for your savings, making it a bestway to invest 3k. The one hitch? This rate is only available to M1 Plus members, which involves a monthly fee. But if you explore the automated investment options I mentioned in #2 above, then it might be well worth it.

If you don’t want to be grandfathered into a monthly fee, consider CIT Bank. Their current HYSA rates are 4.9% or so, and they have great rates for CDs as well. Plus, there are no monthly fees for savings accounts.

7. Pay off High-Interest Debt

Do you have a debt to deal with?If you already have an emergency fund, then you should take that $2000 and pay down your debt with it before making any investments. It certainly simplifies the question of where to invest 2000 dollars.

For example, if you pay off a $2000 balance on a 25% APY interest rate credit card or loan, you will save $500 or more (given how interest compounds) per year, depending on when you would have otherwise paid off the card.

Even debt interest rates of 12% will probably beat out what you can get on the market, and I cannot stress the psychological benefits of paying off debt enough.

If you want help to determine what debt to pay off first or assistance in creating a plan, you should check out Empower(formerly Personal Capital). They have helpful budgeting tools as part of their free dashboard.The biggest step to take will be the first one, and then it’s a matter of paying off your debt a little every week or month.

One of the bestways to invest 3k is taking a huge chunk out of that debt to kickstart your financial future.

8. Invest in Retirement

You’ve read the articles about the importance of saving for retirement and how Social Security might not last by the time you retire and how you’ll need to fend for yourself and how no one is saving for their retirement.

Yet ignoring the harbingers of economic doom and gloom for a moment, saving for retirement is a smart idea.

You might be thinking “Why invest in my retirement with only a few thousand dollars? That’s not going to be enough to keep my family afloat for a month!”

Let’s say you have thirty years until you retire.If you invest $2,500 dollars, by the time you retire…

• At an entirely safe 5% yearly return (see the high-yield savings accounts from before), you’ll get $10,805 if you put in absolutely no other money.
• If you go by a conservative stock market of about 8%, then the investment will be worth $25,157.
• If you are slightly lucky and willing to take on a bit more risk and get an average of a 10% annual return, then you will be getting $43,624.

And while you might want to consider inflation into that, you’re still making a huge step towards retirement with even a $2,500 investment. Different investment strategieswill provide different results.

Play around with an asset calculatorand see what even a modest investment can get you by the time you retire if you keep it invested. It’ll surprise you, and saving for retirement might be the best way to invest 2000 dollars after all.

And if you don’t know what to invest in or what platform to use, Acorn can be a great option.It will help automate savings for retirement, even in small amounts. And it can be the best way to invest 2k. If you want to be more aggressive, starting with it can be the best way to invest 3k

Bonus: 401k Matching

If you have 401k matching available from your employer, there is likely no better option for where to invest $2000.It’s an immediate 100% return on your investment for your retirement, and that’s not counting the gains you get within your account.

You simply will not find a better deal than that when looking for how to invest $2000 or how to invest $3000. If you haven’t already, work on setting things up and getting a contribution plan going today.

Bonus: Crypto

We discussed alternative investments before, and cryptocurrency can be considered part of that category. Yet considering its press and how everyone is talking about it, we wanted to give it special consideration.

Crypto often gets a bad reputation among some investors and the general public as an investment vehicle. It’s hard to understand, it’s extremely volatile, and no one really knows what it’ll look like in 10 years.

These things are generally true. However, it’s a great opportunity if you’re willing to take on the risk and already have a balanced portfolio to rely on.The return of Bitcoin (BTC) over the last five years has been nearly 8,000%. This is with many twists and turns, and requires good timing, but it can be a fantastic option for a bit of your portfolio.

There are plenty on everythingto do with cryptocurrency, giving you the knowledge to make it the best way to invest 3k.

A Note About Allocation…

When asking yourself how to invest 2000 dollars or how to invest 3000 dollars (or any number in-between), know that you don’t have to invest all of the $2,000-$3,000 into the same thing.You can split up your investments to create a more diverse portfolio, so long as you meet the minimums for each investment (or more likely investment platform).If dividing even $2,000-$3,000 amongst different asset classes will make you feel more secure in your investments, go for it.

Certain assets or investment avenues might be blocked off with this amount of money, especially if you spread your money widely.A portion of $2,000 might not buy many shares of Alphabet (NASDAQ: GOOGL) or Amazon (NASDAQ: AMZN). A fair number of mutual funds might not be available, as the share price will be higher than $3,000. And you might not always get the best signup bonuses and perks from platforms.

Final Word: Best Ways to Invest $2K to $3K

The best way to invest 2000 dollars to 3000 dollars will vary depending on your situation, how much you have invested already, and what rate of return you’re looking for.There are few perfect answers, though there may be a perfect answer for you.

Whether you are investing for the first time or are a lifelong investor with a windfall who wants to try something new, I hope you have a better idea of what to do.

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