We Asked 1,000 Investors What’s the Best Way To Invest $1,000: Here’s What They Said
So you have an extra $1,000 you want to invest. What should you do with it?
GOBankingRates posed that question to 1,000 Americans 18 and older from across the country who already have money invested in the stock market to find out what they think*.
Of our respondents, 57% were men and 43% were women. Most of the respondents, 27%, were between the ages of 35 and 44, followed by ages 18 to 24 and 25 to 34, each with 23%.
The top choice at 32% of all of the respondents was to put the $1,000 into stocks. Buying units of ownership in a company and hoping to earn returns as the company’s value increases is one of the most traditional and popular ways to play the market.
This doesn’t come as a big surprise, given that everyone responding to the survey was already invested in the stock market. But while opinions diverged by age groups and genders in our survey across other forms of investing, including bonds, ETFs, mutual and index funds, stocks held steady across all demographic slices as the most solid choice.
Learn: What’s an ETF?
The second most popular choice overall was more surprising, with 16% of respondents saying they’d put that extra $1,000 in Bitcoin or other cryptocurrency. This choice beat out other more traditional choices like bonds (10%), real estate (14%) or just putting it away in a savings account (14%).
There was a big difference between the genders here. Men were significantly more likely to invest their money in cryptocurrency than women, with 19% of men choosing it versus only 12% of women. And of those who said they’d invest in crypto, most were younger investors in the 25 to 34 age group at 23%, followed by 45 to 54 year-olds, at 19%.
Bitcoin and cryptocurrencies have been gaining more acceptance recently in the mainstream investment community. Many large brokerage firms are now dipping their toes into Bitcoin, and you may soon even be able to use crypto to buy a Tesla. But all crypto is still subject to high volatility and risk.
Looking at it by gender, the second choice for women was to put $1,000 in a savings account, such as a CD or money market (19%), followed by investment in real estate (15%).
Women tend to be more conservative investors than men. Whether that’s because of less confidence, being more risk aware, or having more targeted and long-term goals is a topic of debate. Nonetheless, women appear to make better investment choices. In a 2018 study, Fidelity Investments found that women outperform men in their long-term investment portfolios.
At the bottom of the heap was gold. Only 6% of survey respondents said they’d put their money in precious metals, with slightly more women than men putting their faith in gold (7% versus 5%). The youngest investors had the strongest interest. Most of those who said they would buy gold or metals were between the ages of 18 and 24.
Long considered a safe haven, gold and other precious metals like silver, platinum, palladium and copper values surged to record highs in 2020 as COVID-19 sparked market uncertainty.
The youngest investors were also big on the real estate market. Twenty-five percent would put their extra cash in stocks, but a close 24% thought real estate was the best decision. A lot of money can be made off real estate, but it’s also significantly more complicated than trading in more liquid forms of investment.
On the opposite end of the age spectrum, after stocks (35%), people over 65 preferred the conservative investment options of ETFs/mutual funds/index funds and savings accounts, with these two categories tied at 23%. ETFs and mutual funds (with index funds being a type of mutual fund) are professionally managed pools of capital contributed by investors. They’re popular choices for retirement savings because of their low risk factor.
For investors 55 to 64, traditional savings accounts beat out ETFs, mutual funds and index funds by more than double, at 25% over 12%.
An investment of $1,000 can go a long way over time. Here’s our guide on investing for beginners to get you started successfully!
More on Crypto From GOBankingRates
- 3 Common Crypto Misconceptions Debunked
- Crypto Curious but Risk Averse? You Can Invest as Little as $1 — on Venmo
- Cryptocurrency Complicates Splitting Assets During a Divorce
- 3 Easy-To-Use Cryptocurrency Investing Apps for Beginners
*To be upfront, we actually only got 999 responses but the difference was not statistically significant to our analysis.
Methodology: GOBankingRates surveyed 999 Americans aged 18 and older from across the country on May 10, 2021, asking six different questions: (1) Where are you currently investing and/or saving your money? Select all that apply; (2) Which of the following most closely matches your investing goals?; (3) If you received an extra $1,000, which ONE of the following do you think is the best way to invest it?; (4) Do any of the following statements about investing in cryptocurrencies apply to you? Select all that apply; (5) When did you first start investing your money in the stock market (not including retirement accounts like an IRA or 401(k)) and/or cryptocurrencies?; and (6) How much money do you currently have invested in stocks or cryptocurrency?. All respondents had to pass a screener question of: Are you currently investing/have money in the stock market?, with an answer of “Yes.” GOBankingRates used PureSpectrum’s survey platform to conduct the poll.
Last updated: June 21, 2021