A $500 investment might do more for you than you think. In this article, we will discuss some of the best ways to invest $500 in 2023, such as investing in stocks, mutual funds, ETFs, bonds, and other creative investments. 

This $500 investment might not lead you to financial freedom but it will give you the momentum to start investing and build a habit of lifetime investing. 

15 Smart Ways to Invest $500 Today

1. Invest in a Certificate of Deposits 
2. Invest in a High-yield Savings Account 
3. Invest in Stocks
4. Invest in Bonds and other Fixed-Income Instruments 
5. Invest in Mutual Funds
6. Invest in ETFs
7. Invest in Real Estate (Crowdfunding Sites)
8. Invest in Cryptocurrency
9. Invest in a Business
10. Invest in Collectibles
11. Invest in Micro Futures
12. Invest in Gold
13. Invest in a New Skill that Generates Income
14. Invest in a Course or Mastermind
15. Invest in Investor Networking Events

Factors to Consider when Choosing Your Investments

• Passive or active?

Some of the investing ideas mentioned above are more passive than others – for example, ideas #1-8 are meant for investors who prefer passive investment returns and not too much continuing time commitment. If you want minimum involvement in your passive investing journey, consider using a Robot advisor to start investing the $500.

Other ideas such as investing in a business – by the way, there are thousands of ways to start a business today, such as running vending machines, owning a coin-operated laundromat, and flipping sneakers, etc. – require more active involvement and perhaps capital to maintain the business.

• How long is your investment time horizon? 

Do you plan to use your $500 capital in a couple of months or won’t touch it for 5 years? 

Time invested matters. For example, stock investments are great for long-term investors; high-yield savings accounts and CDs are better for short-term investors. In general, investing in a business, real estate, and your own education is a long-term game that requires the accumulation of knowledge and opportunities but the potentials of these investments are limitless.

• Do you have specialized knowledge or a particular passion in one area? 

Information asymmetry might give investors huge advantages in a world of specialization. If you have worked in an industry for many years and have profound knowledge in some area, use and apply your experience and skills to your investing! 

For example, a retail specialist can identify market trends and pick out retail stocks with great upward potential. If an investor is passionate about fine art, she can dive deeper into the world of investing in fine art collectibles while pursuing her passion. 

Last words

The good news are that you can start investing with just $500 today and there are so many ways to invest! Meanwhile, figuring out your strength and niche in investing requires some trial-and-errors and time to reflect.