How to Invest $100K the Right Way

At some point, you may find yourself with $100,000 in the bank and questions on how to invest it. Whether you are looking to get a return on the money in the short-term or achieve growth in the long-term, there are many investment options to consider. Some people might recommend that you invest in stocks, one of the most common ways investors start out. Stocks can provide a powerful path to building long-term wealth, but the risk level can be high, especially if you don’t have the patience or the time to ride out the ups and downs of the market. Others might recommend investing in real estate, cryptocurrency, or gold. However, going straight to what you are going to invest in, does not consider your personal goals and circumstances. 


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What is right for them isn’t necessarily right for you

Of course, there’s no one “right way” to invest $100,000; the ideal investment will look different for each person, depending on one’s financial situation, goals, and priorities. We suggest you take the following four steps when deciding how to invest your $100,000: 

  1. Establish short-term and long-term goals.
  2. Prioritize those goals.
  3. Allocate money between the highest priority goals.
  4. Invest your money per the investment horizon, return expectations and risk tolerance of each of those goals. 

For example, after listing out your short-term and long-term goals, you may decide the highest priority goals are: 

  • Goal 1: $30,000 to fund a rainy-day fund that covers living expenses for six months in case you or your partner fall ill or unexpectedly lose your job.
  •  Goal 2:  $30,000 to add to your home down payment fund for a home purchase in five years.
  •  Goal 3: $40,000 toward your goal of retiring by age 60.

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Each goal should be invested differently since they all have different timelines. The emergency fund, for example, can be invested in a combination of money market funds, series I savings bonds, and short-term, laddered CDs. Your home down payment fund can have some 5-year treasury bonds and short or intermediate-term high quality bond mutual funds. The $40,000 you set aside for retirement should be invested in a diversified portfolio with global equities and bond. The portfolio may also have small allocations to other investments such as real estate, gold and commodities to provide further diversification or inflation protection benefits. 

Other options to consider

Beside savings goals, another effective use for your cash would be to pay off high interest debt such as credit card balances or personal loans. You would at once improve your net worth and speed up your path toward long-term wealth by taking this step. 

Investors who are comfortable with a little more risk may use the money to buy or start a new business. Oftentimes, a business will need an investment of more than $100,000 to eventually turn a profit, but business ownership can be an important part of building long-term wealth and stability. 


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Many people wonder if they should invest in cryptocurrency. We feel that you should only invest as much as you can afford to lose. While the technology behind this new currency system is promising, investing in it comes with extreme volatility. Over the last seven months, for example, Bitcoin has lost 70% of its value from a high in 2021. 

There are many ways to improve your future with $100,000. With some careful goal planning and wise investing, your plans might come true sooner than expected.

Looking to achieve seven figures? The average age to make your first million dollars is only 37, and you can certainly reach that benchmark if you invest wisely.

Disclosure: The opinions expressed within this blog post are as of the date of publication and are provided for informational purposes only. Content will not be updated after publication and should not be considered current after the publication date. All opinions are subject to change without notice, and due to changes in the market or economic conditions may not necessarily come to pass. Nothing contained herein should be construed as a comprehensive statement of the matters discussed, considered investment, financial, legal, or tax advice, or a recommendation to buy or sell any securities, and no investment decision should be made based solely on any information provided herein. Links to third party content are included for convenience only, we do not endorse, sponsor, or recommend any of the third parties or their websites and do not guarantee the adequacy of information contained within their websites.

About Monica Ma

Monica Ma, CFP®, CFA® is an advisor and the chair of the Investment Committee at Blankinship & Foster LLC. She helps clients build sound investment portfolios and develop strategic plans to reach their goals. Since Monica is passionate about sharing her knowledge with women and retirees, she co-leads the firm's Wise Women and Living Wisely Educational Series. Monica is a member of the International Community Foundation's Investment and Finance Committee. She has been living in San Diego since 2008 and enjoys travelling and cooking with her family.

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