If you want to know what to do with 200k, this article will help a great deal.

It reveals a lot of helpful information as well as best tips on how to know exactly what to do with 200k.



There are many decisions that we need to make during the day.

Some of those decisions could include what to wear, what to eat, what movies to watch, etc.

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All of these could be classified as minor decisions.

However, there are those significant choices that can be life-changing.

Some of those questions could include should I go back to school, should I change jobs, are they right person to marry, should I buy this house?

And then there are financial significant decisions that need to be made.

What if, for example, you came into an inheritance or some other type of monetary windfall?

What would you do with $200,000?

Let us look at possibilities of how to proceed to direct the power of this hurricane-strength windfall to your best advantage.


Personal Story

The most significant financial windfall that came my way was winning a lottery of sorts when I received $20,000.

After the initial excitement subsided a bit, the questions then began to swirl around in my mind as to what to do with this money?

Several thoughts crossed my mind including making small gifts to family members, buying things that I didn’t need, investing the money, etc.

Eventually, I ask myself the question of what this money would be best used for as it related to my current financial situation.

I decided to put the money to credit card debt after setting aside money to pay taxes.

My rationale was that the interest that I was paying on the debt was a better use of the money rather than any return on investment.


20 Best Tips to Help You Know What to Do With 200k


1. Access Your Current Situation

The first component of the strategy when asking what to do with the $200,000 would be first of all to take a deep breath.

This is an exciting moment and decisions should not be made in the excitement of the moment.

It would be best to deposit the check in a savings account for the moment.

Also, a number consideration is the thinking that if this was a $200,000 inheritance, this was money that once belonged to someone else, and they worked hard to invest their money and make their money work hard for them.

Therefore, as an added incentive of what to do with $200,000 is the attitude of honoring this person’s financial legacy.


2. Research 

An option for an individual to determine how you best wish to proceed with the $200,000 is to do your research.

By searching online, you will be offered several possibilities and a variety of advice that may resonate with you.

The bottom line is that the strategies should be in alignment with your financial thinking and within the parameters of your risk tolerance.

Remember if it sounds too good to be true, it most likely is.



3. Pay Off Credit Cards

An option that you may wish to consider is paying off any indebtedness.

The questions that would swirl would be the reality that if you are carrying significant balances at a higher rate of interest and your possibility of interest earned on investments is lower what is the best option or return on your money.

To determine the best course of action would be to “crunch numbers” and see what is the best as it relates to interest paid (debt) or interest earned (investments).

Some financial calculators can be of assistance. One such calculator can be found at https//www.ent.com/education-center/financial-calculators/invest-payoff-debt/.


4. Home 

If you don’t own your own home a great investment opportunity that has long-term ramifications would be to purchase a home.

$20,000 would go a long way towards a good down payment on a home.

The benefits of owning a home would be that you no longer would be paying rent to a landlord and increasing their wealth, but you would be increasing your wealth through the continual increase in value of your home.

This will build up your equity in the home which is probably the most important purchase that an individual or family can make.


5. Stock Market 

A tried and proven method of making your money work for you that has been demonstrated for a significant number of years is investing in the stock market.

Your choices would be to conduct your research and buy stock in a variety of businesses that are performing well, have limited debt, are flush with cash, and is a product that continues to be popular amongst consumers.

However, if you are not comfortable investing in the stock market yourself, it would be wise to seek out a professional and use a stockbroker to recommend the investments and then do your research and then consider those recommendations.


6. Real Estate 

Another option to utilize $200,000 is to buy an investment property.

If you were to purchase an investment home and rented out to tenants, you would realize a monthly income of most likely well over $1000 a month.

This would work out to be a return of 6% for the year on your investment.

Of course, there would be expenses, but when you do your income taxes, a significant number of these expenses can be written off as a deduction.

The only possible downside of investing in real estate is that your money becomes “tied up” and is difficult to utilize any of the liquidity associated with the $200,000.

As with all things related to income taxes and credits and deductions, it is always best to consult with a tax professional to ensure that the proper deductions are taken and are accepted by the IRS.


7. Gold 

An alternate investment that can be researched is the purchase of precious metals.

This precious metal can be either silver or gold.

There are many schools of thought as it relates to owning gold as to whether it should be physical ownership and be able to be held in one’s hand or whether you would get gold certificates.

As with all things related to money and investments it is important to you your research which would include a historical perspective about gold and possible speculation as to where the worth of gold may be headed.


8. Emergency Fund 

It may be a good idea to keep some of the money liquid and designate that money as an emergency fund.

An emergency fund is a good strategy because when negative things happen, that money would be available to smooth the troubled financial waters and prevent the possibility of taking on further debt or invading your investments.

Many financial gurus suggest that anywhere from 3 to 6 months of money be set aside which equates to 3 to 6 months of expenses.


9. Buy a Business

Another possibility of what to do with $200,000 would be to buy a business.

By investing in a business, the option of long-term income is a possible reality and one may earn passive income over the years.

Possibilities of owning a business could be the purchase of a franchise or an already established business.

The potential negative aspect of this option would be that buying a business is not for everybody.

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There is a certain element of risk and, as with all investments, there are no guarantees.


10. REITs 

REITs or Real Estate Investment Trust is another investment opportunity in which many types of real estate are owned such as office space, commercial real said, apartment buildings, warehouses, etc.

By investing in a REIT your investment is pooled with other investors which allow for individual investors to earn dividends from these real estate properties.

The upside is that the individual doesn’t have to buy, manage, or finance any of the properties.

A quality REIT can provide a steady stream of income for investors.


11. 401(k)

If you are self-employed or own your own business, there are additional options as it relates to 401(k)s.

You have the option to invest larger amounts of money towards your retirement.

The contributions that are made will also provide tax advantages.

In years gone by, the owner of the business was able to contribute up to 25% of their compensation as their employer.

This amount was capped.

Rather than speak in terms of percentages and amounts, it is important to do one’s research and possibly talk to a tax advisor to find out more about this potential opportunity to invest larger chunks of money.


12. Online Brokerage 

One of the best ways to invest the $200,000 that has come your way is to sign up for an online brokerage account.

There are many reputable financial institutions which include Schwab, Fidelity, Vanguard, etc.

Again, the watchword is research, and one should do their due diligence in finding an investment firm that is well thought of by your friends and individuals within your sphere of influence.

Additionally, the choice of program is dependent upon the actions that you wish to take.

For example, a firm like Vanguard would be a wise choice if you just are going to invest the money and let the investment be handled passively.

On the other hand, if you plan on being aggressive you may wish to go to a broker that offers a no-fee trading platform to minimize your overhead costs.


13. Retirement or Brokerage 

Once you set up your brokerage account there are typically two types of accounts to choose from.

One account is the retirement account which is typically 401(k)s, Roth IRA, step IRAs, etc.

These particular accounts are retirement investment accounts that focus on providing growth at a tax-deferred basis and are investments that are defined as long-term investing.

The other type of account would be a brokerage account.

A brokerage account is also an investment option but one that is chosen when an individual wishes to maximize their growth potential but still has access to the money for investments possibilities either in the short-term or the long term.


14. Diversity 

To mitigate the negative flow of various investment vehicles, it is always a wise decision to diversify your investment dollars.

In other words, it may be a good idea not to buy all stocks, bonds, or alternative investments.

It is best to spread your investment dollars over a variety of investment vehicles.


15. Stocks 

Purchasing stocks can best be defined as owning a piece of a company.

When looking at owning stocks, the choices should be businesses and corporations that have a proven track record of successful business practices and continually making a profit.


16. Index Funds 

The purchase of Index Funds is the ownership of bonds or an accumulation of portfolios of stocks that mirror or reflect a specific index.

An index fund gives you more variety and diversity across a range of holdings or ownership.

Typically, Index Funds are associated with low management fees and therefore a significant portion of your money is directed towards investing in growth rather than utilizing your investment money for fees.


17. Mutual Funds 

Mutual funds are different from index funds in that they are more of a hands-on management option.

Mutual funds are costlier and are designed with the purpose being to perform better than other specific markets.

As with all investments, there is no guarantee on how they will perform but part of the diversification strategy.


18. ETS’s 

ETFs are similar to Index Funds with the exception being the process of buying and selling which occurs throughout the day similar to the process of buying and selling stocks.

ETFs are more hands-off managed investments and often are automated and do not require much management from the fund manager.

ETF stands for Exchange Traded Fund.


19. Bonds 

A bond is issued from a company when they wish to gather together amounts of money so that they can invest that money into the company.

The investment back into the company could be through the purchase of software upgrades, hardware upgrades, infrastructure needs, equipment purchases, etc.

To raise this money, they sell bonds and individuals can purchase these bonds and receive interest back on these bonds when they come to maturity.


20. Engage a Financial Advisor 

A possibility to help you with your decisions on what to do with $200,000 is to engage a financial advisor.

It is important to realize that not all financial advisors are the same with some simply out to receive commissions or fees while others, as well as accepting commissions and fees, have a sincere and professional commitment to providing quality service and sound financial advice.

The best way to find a reputable financial advisor would be the recommendations of those whom you trust in your sphere of influence and after conducting your research, ensure that there are no negative comments associated with the individual’s professional performance.


What to Do With $200,000 FAQ


Are There Any Percentages Attached to Any of the Suggested Investment Vehicles?

Some possible suggested allocated percentages to the various types of investments could include:

  • Real estate 15%
  • Stock market 40% to 50%
  • Cryptocurrency 5%
  • Gold 15%


If I Have Debt, Should I Consider Paying Off My Debt Rather Than Investing the $200,000?

Although one does not want to have the stress and anxiety associated with owing money, the best way to answer this question would be what is the best return on your money?

In all likelihood, the best approach would be to conduct your research and “crunch the numbers” as to what is the most effective use of the money.

For example, if you have indebtedness in which the interest is fairly high, then perhaps, the paying of that debt is the better investment rather than getting a return of something that may be less than what you are paying on your debt.

Of course, it is strictly your call, but it is best to weigh all of the scenarios so that the money that you have is more advantageous and impactful on your finances.


You Can Do It

If you have come in $200,000 you are in an enviable position.

The options of how you can effectively and fully use this money to leverage additional investment dollars are fairly robust.

As you can see there are many opportunities and can be a little bit overwhelming to know what direction to take and where to possibly place your investment money.

The best piece of advice is to do your research, take it slow and steady and not jump at any potential opportunities before doing your due diligence.

If you opted to seek other guidance as to how to utilize this money, it is important to realize that nobody will be “jealous” of your money as you will.

Therefore, listen to what others may have to say and their recommendations but it is important to do your research.



$200,000 is a significant amount of money.

Without a doubt, it needs to be invested and most likely those investment options should be diverse rather than just placing the one lump sum into one investment vehicle.

Again, this company has paid $25+ million to members:

SurveyJunkie (only USA, Canada, Australia residents allowed). You can earn money sharing your thoughts. They have already paid $25+ million to their 20+ million members just for sharing their thoughts and opinions. Click here to join SurveyJunkie for FREE

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Apart from being a seasoned Personal Finance expert who has written for top publications around the world, I bring significant personal financial experience. Long story short... through bad financial choices... I found myself $100,000 plus in debt. I was able to dissolve this indebtedness and regain financial solvency. This financial turn around was accomplished through reading, studying and implementing a financial plan. My financial plan included paying down my debt through budgeting, being cognizant of where my financial resources were being spent, changing my attitude about money and understanding the binding chains of the improper use of credit. Today, and for 10 years, I have been debt free and have invested wisely to enjoy my current retirement. This is allowing me to write to help others make, save and grow money wisely!