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Where to Invest Your Money in 2021

The stock market was down nearly 40% in early 2020. I bought as much as I could at the bottom, but now we’re already back to the top again. With all the uncertainty, the stock market just doesn’t seem like the best place to invest anymore. So, as we head into a new year, I’ve got the same question that the rest of you probably have…Where to invest your money in 2021!

The Disclaimer…

I’m a financial analyst by day and a personal finance blogger by night. I’ve been in and around the finance arena for over a decade. The actions and thoughts below are my own and actually stem from conversations I’ve had with many other millionaires. However, I am not a certified financial planner and nothing written below is a promise for success. So, while I have some great ideas (I believe) about where to invest your money in 2021, please invest at your own risk.

My Actions and Results in 2020

In March of 2020, the stock market was beat up pretty bad. The Dow went from nearly 30,000 down to 18,591 in just a matter of days. 

Before the crash, I had just one main stock market investment: my retirement portfolio.

  • Pre-crash, my retirement peaked out at $170,000
  • When the market fell, I saw my investments go below $120,000

It was a pretty terrible feeling, but I took the advice that I gave to so many others.

  • Don’t freak out.
  • Keep your money in the market.
  • And you know what? If you have money, start buying up a bunch! Stocks are on SALE!!

Starting on March 13th, not only did I continue to invest in my retirement portfolio, I also started to load money into an S&P 500 index fund – at a rate of $2,500 every two weeks.

where to invest your moneyRetirement Fund and S&P 500 Index Results

Today, my retirement fund isn’t still sitting down at $120,000. It has bounced back, and with a vengeance! On this date, my retirement fund is worth $206,000. BOOM!

And, from March 13th to mid-November, I was able to invest another $45,000 in a separate account. Today, that investment is already worth $54,000. That’s a fantastic 20% return on my money!

Some people sold in March for fear that their money would continue to deplete. If they were in my shoes, they would unfortunately have just $120,000 today. 

Instead, I’ve got $260,000.

I don’t say this to gloat or to point a finger at myself. Many of my readers have experienced similar results. Is it because of me? Not necessarily, but having these regular conversations about investing and what to do next certainly helps.

Now, it’s time to keep the dialogue going into this next year — where to invest your money in 2021. Let’s brainstorm together, shall we?? 🙂

The Current Climate – Late 2020

Let’s paint a picture for what the investment climate is like currently as we head into 2021:

The Rising Tides in 2021

The pandemic put a choke-hold on the world in early 2020.

  • Many were getting sick
  • Hospitals became flooded
  • Many areas and businesses were locked down by the government

Even today (nearly a year later), people are still locked in their houses and rarely go out, for fear of contracting the virus.


BUT, there’s help coming

Vaccines have been approved and will soon be delivered. People will begin feeling free once again. They’ll go out, they’ll spend money, and they’ll enjoy themselves like never before.

Morgan Housel, a former Wall Street Journal columnist, recently stated:

“One thing that I think is overlooked or underappreciated today, are the odds — and this is not my baseline forecast — but the odds that 2021 could actually be one of the best years for the economy in history, which sounds ridiculous given what we are dealing with right now.”

I absolutely agree.

I personally believe the atmosphere will be akin to the year 1946, the year after World War II ended.

Bars will be packed, people will congregate, and all will catch up on the laughs that were missed in the year(s) prior. Spending is going to be outrageous, and therefore the economy is going to spike as well. I truly believe that. 

With the slowing pandemic and the surge in spending, jobs will spike once again. The tides will soon rise, and all the ships will of course rise with it.

Where to Invest Your Money in 2021

What does all this mean? What should we all invest in now so that we can benefit from these rising tides that are on your horizon?

Let me remind you, I don’t have a crystal ball. At the drop of a hat, something could come down the pike and totally change everything (you know…like the pandemic did!). The suggestions below are the areas I will likely invest in. You may use your logic to invest any way you choose.

deeply in debt1) Pay Off Consumer Debt

Do you have….

  • credit card debt?
  • medical debt?
  • car loans?
  • student loans?

If your loan percentage is over 8%, I’d say pay those bad boys off as fast as you can.

Personally, I’d pay off any consumer debt quickly regardless of the interest percent. They’re just a nuisance and there’s nothing like looming debt that causes you to make foolish future decisions (you know, things like…”Well, my car is dying and I still owe $5,000 on it. I guess my only choice is to take it to the dealership and get screwed on the trade-in AND on the new car purchase!”)

If you have consumer debt, stop worrying about the economic opportunities out there and just pay off your stinkin’ debt.

Want to do it fast?? Use this free debt snowball tool!

2) Vacation Properties

People are leery about touching anything these days…and that includes other peoples’ pots, pans, silverware, furniture, door knobs…pretty much anything in a vacation rental.

Follow me on this logic:

  • Vacation rentals aren’t making the money that they once were since people aren’t currently travelling and demand is way down.
  • The vacation rental owners still have to cover their mortgage payment (likely their 2nd mortgage payment, including their personal residence), and they’re probably getting tired of losing money
  • Naturally, they might think about selling the property before they get too tight on money – or before they drive themselves too deeply in debt.

If you find someone in this scenario, you’re likely to score a great deal on the buy!

Then, after the vaccine comes out and life begins to return back to normal, people will vacation again, and vacation HARD! 😉 

You’ll be left with a property that’s worth far more than you paid for it AND your cash flow will be much better than it had been during the heart of the pandemic.

Related: 10 Ways to Find a Deal on Real Estate 

reasons for investing in land3) Land

Right now, not too many people are selling their houses. In times of uncertainty, they’d rather just hold onto what they have, what they know.

However, with interest rates being at their all-time lows, there are plenty of new buyers out there that are looking for a place to live.

So what do they buy when there’s not much for sale?

They don’t overpay for an existing house. They build.

And, for anyone that wants to build, what do they need??


It seems like land has always been a good buy. People continue to expand where they live, and therefore land is continually in high demand.

The Problem with Land

There’s just one problem with land — it’s not income producing.

You can buy a property for $100,000…but then you’ve got a hundred grand tied up and you’re not getting any money for it…not until you sell it at least.

Here’s some ideas to combat that:

  • Buy a rental house with property….say…10 acres. Then split the property. Keep a half acre for the house (and continue collecting rent) and then free up 9.5 acres to sell!
  • Buy a plot of land that can be farmed. Either plant something easy to grow and sell (like pumpkins), or buy a plot of land that a local farmer would be interested in leasing.

If you’re wondering where to invest your money in 2021, this might just be the safest bet…and may honestly yield you the most money in the end!

4) Commercial Real Estate

Businesses are struggling right now, especially businesses that require walk-ins for business (such as retail and in-person service). These places are usually located in a strip-mall of sorts – like, a large building that’s broken up into multiple store-fronts.

At this moment, it’s not uncommon for only 2 out of four businesses to actually be open for business. Revenues aren’t coming in and perhaps the rents aren’t getting paid. This is bad news for the current owner, but could be good news for you.

Why is a half-vacant property a good thing?

Real estate like this isn’t valued based on the structure like residential homes are. The value of commercial real estate is based on the income it provides. 

  • Let’s say the property nets $40,000 a year. Let’s say that this puts the value at $400,000.
  • Now, let’s say the property only has half the rents coming in. It’s only netting $5,000 a year. This greatly reduces the value of the property. It may even bring the price down to $300,000.

 And this is where you can scoop up a deal!

Now, keep in mind that you don’t want a deal if it means reduced rents for life. You’ll want to have a plan on how you can eliminate the vacancies.

  • Perhaps you have contacts with a few businesses in the area that would rent the space
  • Maybe you could do a light remodel on one of the spaces to make it more appealing for a more rapidly-growing industry
  • Or, maybe it’s worth an over-hall to transform the entire space into apartments! Who knows! 

Your only limit here is your imagination. Sometimes the best deals are found because everyone else lacked the vision of what the space could be.

options if you can't sell your house - for rent5) Rental Houses…If You Can Find Them

When I’m posed with the question of where to invest your money, I still love the single family rental option. They rent out well and they have a great exit plan if things don’t work out the way you expected.

However, they’re definitely in demand right now…and selling for a premium.

Given the tough times though, I’m imagining a wave of foreclosures coming – perhaps in the next year or two. The only trouble is, with the increased demand in housing right now, there are plenty of people that will be chomping at the bit to buy these properties before you.

You’ve just got to be ready. I plan to:

  • Start saving up money now to potentially make a cash purchase two years from now. Cash always talks louder than loaned money.
  • When I’m ready, I’m going to start looking for homes that might soon be for sale…but just aren’t yet
    • Look for signs of overgrowth
    • Take note of elderly people living in houses in your area
    • Identify houses that would be great rental properties and send letters to the home owners, letting them know you’re interested if they’re ever willing to sell
    • And, always put the word out there. Tell everyone what you’re looking for. Word has a way of spreading, and it could lead you to a great property!
  • Then, when the opportunity comes, you’ve got to be ready to move quickly. Hesitate and you’ll lose it in this market.

And, it’s worth noting that it is okay to walk away! If something doesn’t feel right or you think you’re overpaying for the property, then just let it go! There will always be another deal out there.

Where to Invest Your Money in 2021 – What’s Your Pick?

Do you like the opportunities listed above? Which one would you choose and why? 

No matter what year it is and what the economic conditions are, there will always be deals out there. You just have to keep thinking about where to invest your money. Keep it on the forefront of your mind at all times. If you do, the opportunities will present themselves.

Are you ready to invest? Tell us what you’re looking to invest in for this year or the next!

Grow Rich Money


My name is Derek, and I have my Bachelors Degree in Finance from Grand Valley State University. After graduation, I was not able to find a job that fully utilized my degree, but I still had a passion for Finance! So, I decided to focus my passion in the stock market. I studied Cash Flows, Balance Sheets, and Income Statements, put some money into the market and saw a good return on my investment. As satisfying as this was, I still felt that something was missing. I have a passion for Finance, but I also have a passion for people. If you have a willingness to learn, I will continue to teach.

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