15 Ways to Invest $1 Million

30 August 2020

How would you invest 1 million dollars?

Many of you want to become millionaires and some of you might already have crossed this milestone – but the question still persists: What are the best ways to invest 1 million dollars today? This one is for both categories.

People say the first million dollars is the hardest to make, but today, a million dollars isn’t what it used to be.. The catch is: you need to have a million dollars to understand that it’s not enough. So what is there to do?

Read until the end because we’re breaking it down for you!

Let’s say that somehow you got your hands on a million dollars – after taxes. Maybe you sold your first company, maybe you got lucky and Aunt Jemima left you a hefty inheritance. What do you do with the money?

Buckle up, for we will take you through it all!

If you don’t feel like reading this long article, feel free to enjoy the video version:

Let’s break down your best options! Here are 15 Ways to Invest $1 Million.


Buy rental properties

This is the first item on our list, because this is what we did. The moment real money started coming in, all of it went towards buying rental properties.

What we’re about to say will definitely step on some toes, but:

1 million dollars isn’t enough to make you rich!

But if you know what you’re doing with it

1 million dollars could mean you’ll never be poor again!

at least that’s how we did it-.

1 million dollars invested in rental properties will bring in between 50,000 – 100,000 dollars per year in rental income. – and this is straight up paying cash for your properties.. If you know what you’re doing and are open to using debt things can look much brighter.

You’ve got plenty of options to choose from: single family, multi family, commercial spaces.

Anyone with 1 million dollars can pick up a couple apartments near the city center (or around business centers) and live off the rent.

As we said earlier: 50-100k per year, before tax, might not qualify as rich living by no means, but if you’re frugal it means you and your family will no longer worry about food or bills again.

The average property appreciates by 3 to 6% in price every year!

So not only you’re bringing in rental income, but the price of the property is also going up.

This is important so pay attention:

The first million dollars park it in things that make you money while you sleep & then pretend you never had it.

A couple of nights ago, we were hosting some friends and one of them raised the following question: What would you do with 5 million dollars right now?

Our answer: Put it next to the other ones and get back to work!

People wrongly assume that if you get to 1 million dollars you’ll stop working and sip Cuba Libres in Cuba on a beach only to get there and realise that life has more in store for them.

But maybe you’re not a sophisticated real-estate investor and don’t know where to invest. That’s where this next option comes into play:


Invest in a REIT

REIT stands for; Real Estate Investment Trust

To put it simply, people with money, such as yourself, come together and put it together in a managed fund. The people who manage the fund go out into the marketplace and invest the money into properties that generate income. The money coming in is then divided by how much every person contributed to the fund.

REITs are great for people who don’t want to handle the day to day aspects of managing their rental properties and these funds also have the added benefit on getting yourself involved into bigger deals; for example: Buying and renting an office building is definitely more expensive than picking up 1 or 2 apartments – the type of deal it would be difficult to close in on your own.

Just google REIT + Your Country and you’ll find investment options in your geography. 

Important to know is that if you are willing to put in the time, you can get better returns on your own, but at this stage it’s all about saving you time. 


Bonds or CDs, NEVER in a Savings Account

Truth be told, we didn’t want to include this one. We were about to make a 10 list video, but since you’ve been so vocal about including everything we put this in early so we can get it out of the way.

Out of the three, bonds are our favorite option. They’re super simple to understand. You simply lend money to a corporation or the government and in exchange for your money you get paid a fixed amount regularly. When the deadline on the bond expires, you are paid back your initial amount. If you need the money you can sell the bonds to other people or back to the bank before the term.

You can find bonds in every country. These vary between 2.5 and 6% and you can buy government bonds directly through your national bank, just walk in and ask them about them.

CDs – refer to certificate of deposits – is another financial instrument where you basically agree with the bank that you will leave your money untouched for a fixed amount of time and in exchange they will prove you with a better interest rate.

Personally we don’t use these. The highest return we’ve seen was under 2% and they don’t have the same flexibility as bonds, but at least they kinda keep up with inflation.

But it’s still better than just keeping your money in a savings account. 

We don’t know about you, but the worst thing for us is just having money sit around losing its value. 

Every single day, the US Dollar is worth less and less!

The government keeps printing money and shoving it into the economy in order to compensate for the impact of the coronavirus and what does the marketplace do… it reacts by absorbing the money and rising prices accordingly. This is why real-estate prices keep going up. This is why Jeff Bezos is worth close to 200 billion dollars. That’s why Tesla’s stock price is going up the way it does right now… it’s just the market absorbing all the new cash.

We do not recommend keeping your money in a savings account for more than short term. 

Do you know how much the bank pays you to have your money in a savings account per year? 0.01% !!!!! * 

Do you know what the average inflation rate is?


If you keep 1 million dollars in a savings account for 1 year, at the end you will have 1 million and 100 dollars. Bank of america will effectively pay you 100 dollars to keep 1 million dollars in your savings account. Don’t believe us, do the math yourself:

15 ways to invest $1 million - Bank of america savings rate alux

But the buying power drops because of inflation and effectively your money is now worth: 975,600. Inflation just costed almost 25,000 in a single year,. No matter how you put it, you’re losing waaaay more than you’re earning.

And that my friends is why you never keep your money in a savings account or under your mattress for that matter.


Gold, Silver & other Metals

If the previous point freaked you put by the impact inflation has on your wealth, don’t worry, there are ways to protect yourself against inflation. 

The preferred option of multi-millionaires to make sure their money keeps its value is to convert it to gold and silver. 

You can buy a gold or silver index on any trading company but you can also go about it the old school way: Go out and buy physical gold.

Gold has been the go-to resource for store of value since the middle ages. What we like about metals is that every time governments screw with the economy, smart investors always move their money out of the marketplace and into gold, resulting in predictable jumps in the price of gold. For example: This is the price of gold for the past 20 years.

Invest 1 million dollars price of gold last 10 years

And here is the yearly price increase for the past 10 years.

Screenshot 2020-08-22 at 12.05.48

2010 – was the jump after the economy crashed in 2009.

2020 – we have covid on our hands and the feeling that the entire stockmarket is in a bubble, so people move their investments into gold, at least for the medium term.

At this point you might be thinking.. “Why the hell would anyone invest in something else than gold… just look at those returns!!” 

And the answer is fairly simple: for sophisticated investors, the price of gold is a barometer of just how quickly Fiat currencies like the us dollar or euro are losing their buying power. 

When you invest in gold, although the price goes up, the value remains the same!

Your gold doesn’t make any more gold while you keep it in your safe, it’s just worth more in today’s money. 

If you want to grow your fortune, you need to technically beat the “return” gold provides. 



You want the hands down best option where to park your money and have it grow for you: INDEX funds is the answer. But don’t take our word for it.

Someone asked Warren Buffet the following question:

“What would you tell someone to do with a million dollars that is 30 years old, unmarried, and with no dependencies. Please be as specific as possible.” – Random man

“I would invest it in a Vanguard index fund and get back to work.” -Buffett

That Random man was Tim Ferris, the author of the 4 hour work week and tools of titans.

For those of you who have no idea what we’re talking about, allow us to introduce you to the S&P 500.

This is a fund that bundles together the top performing 500 companies in the US. if a company does poorly, it’s automatically taken out and replaced with the one coming up.

You are basically investing in the best companies all at once. Because of this level of diversification, you are almost guaranteed that you will make money over the long run.

Ready to have your mind blown away?

The average annualized total return for the S&P 500 index over the past 90 years is 9.8 percent.

Almost 10%, year after year for 90 years. 

1 million dollars invested today at 9.8% over 10 years means 2.6 Million. 

Keep it there for 20 years and you’ll end up with: 6.5 million

If you’re young and have time on your side, leave it for 30 years and you’ll end up with: 16.5 million dollars.

This is why even Albert Einstein considered “Compound Interest as the 8th wonder of the world”.

This is how you make sure you never go broke. Set it and forget about it and your entire family tree could leave off the interest when you retire. 

We’re not sponsored by them, but hands down the best way to invest in an index fund right now is VANGUARD. Check if they’re available in your geography and start learning more about them.

If this is exciting for you and something you want to take full advantage of in your lifetime, we recommend you pick up the following book MONEY: Master the game. We’ll link to it in the description. It’s a simple read that walks you through the entire industry. Even better, if you go to alux.com/freebook and this is the first time you sign up, you can get the audiobook for free thanks to our friends at Audible. 


Stock Market

All this investment has probably got your blood flowing and the more you think about it you come to realise that maybe you can do better than 10% per year. You’ve seen Tesla’s stock price increase 5 times since March 2020 and want a piece of that action. 

We promised we will always keep it 100 with you. 

Statistically, nobody beats the market* in the long run!

*market = S&P500

But now and then great opportunities preset themselves for those who are willing to take advantage of them.

A while back we did a video on the stocks we’ve invested in during the pandemic – which you can check out below  and we’ve been able to cash in substantial returns because of it and we’re nowhere near the point of sale. 

Although most of our stock funds are just growing in an index fund, now and then we love the rush you get when you play the market and get it right. 

The best way to learn is to simply invest a small amount of real money – don’t fool yourself trading with demo money – and play it as safe as you can. You’ll learn more by doing and having money on the table than if you just played “investor”.

The internet is filled with stock investment platforms so you should have no problem finding one.

We’re not paid or sponsored by any of these, but some great beginner options are: Robinhood, Revolut, eToro and so on, if you want to do this, you’ll find a platform that works for you..


Start a business

We’re halfway into our 15 best ways to invest $1 Million. With the more passive options out of the way, it’s time to get busy.

If you had a million dollars and wanted to invest in a business, why not invest it in your own business? That way you’re taking in all the risk, but, you’ll also enjoy the full return.

Starting a business is a lot more complicated than having a job.. It’s more like you have multiple jobs and you’re not getting paid unless the business survives and thrives for a couple of years.

Sure, the million dollars you have under your belt will prove to be quite an advantage and allow you to hire better people and buy the tools you need to accelerate your growth, but don’t fall into the trap of overspending.

Anyone can make money if they have money, the goal is to make some without spending any!

As long as you have a frugal mentality when it comes to your own business you will be able to grow it steadily and organically. 

We’ve made a video called 15 things you need to know before starting your first business that we strongly recommend you check out.

What if you don’t want to take on the burden of starting a new business from scratch? Then the next option might be for you.


Angel Invest

Angel investing is when a new start-up needs money and help to take the project off the ground and you’re the one who provides that capital and expertise in exchange for a percentage of the business.

Angel Investing = Seed capital & guidance in exchange for % of the business

With the age of tech start-ups popping up left and right everyone wants to think of themselves as angel investors. Truth be told, this is probably the highest risk option out of this entire list. 

No matter how good you are, if the company you’re investing in isn’t the one to take the project where it needs to go, it will fail and so will your investment.

A seed investment varies between 10,000 to 100,000 dollars. This money is used to get the company to create what is called a minimum viable product and pick up a bit of traction. Based on how well you do at this stage, you can then go ahead and raise more funds at higher valuations.

Seed investments aren’t as complicated as they seem, but you never want to be what we call in the industry: DUMB MONEY. 

Dumb money refers to someone who doesn’t bring anything else to the table apart from money.

Only invest in businesses you understand and have the expertise and connections to accelerate their growth.

The entire process used to be rather complicated but today you have options like Angelist (angel.co) where you can invest in startups from anywhere in the world as an angel investor. And no… they’re not a sponsor either – we hate how we have to say this every single time.


Venture Capital Fund 

Investing in companies is also evolving and that’s where the funds come in. Instead of hand-picking one or two startups to invest in, you can take the index fund approach here and pool your money with other investors so that you diversify your investment and minimise your risk.

That’s how venture capital funds came to be. Your 1,000,000 dollar investment could back 10 to 20 different companies. Statistically, 10 of them will fail completely, 5 will barely hold on for their dear life, 4 will grow steadily and maybe 1 will blow up. Your bet here is that the money you’ll make off of this one will be enough to make a profit.

These collective funds have started to grow more popular throughout the world and they usually have a minimum entry level to allow you to invest, some might even have you commit a recurring amount of money every quarter, make sure you understand what you’re getting yourself into.

For beginner investors, we definitely wouldn’t recommend venture capital as the main option. If you made or have 1 million dollars, there are safer ways to go about without risking it all.

Speaking of risk:



You know how at number 4 we talked about Gold as a store of value? For years gold was the best option we had, until more recently, when bitcoin came around, which is why people call bitcoin Gold 2.0 – the gold of the internet generation.

We are strong believers in blockchain and what this technology will do for the world in the future, and the idea that you could park money that no government can print more of is definitely appealing to every investor out there.

The price of bitcoin at the end of march 2020 when the covid19 situation had dropped to around $5,000. As of writing this piece the price is just under $12,000.

As the entire ecosystem is evolving the entire process becomes a lot simpler and leaner to access.

Many of you are put of because you feel like you don’t understand the technology and how to go about it in a safe way, so we’ve got you covered. Right now we are in the post-production parts of a new course on Bitcoin and Blockchain where we do just that: we hand-hold you from the beginning to the end, explain in layman’s terms how the technology works and show you the exact tools we use to buy, hold and sell our own bitcoins. 

If you’re interested in this course, we’ve set up a waiting list at: alux.com/bitcoin 

Make sure you add your email so you get notified when the course goes live.


Peer to peer lending

Peer to peer lending is the old practice of giving someone your money and they have to pay it back with interest, very similar to how banks and loan sharks do it, but completely legal.

Even technology got involved and now there are plenty of peer to peer lending platforms online.

We don’t use any of them, but other acquaintances of ours do. 

Some of these platforms will show big promises of 12-15-20% yearly returns and although you can hit those type of numbers, we never personally looked at peer to peer lending as a long term strategy. 

It could work for those of you with a little capital and higher risk levels, but honestly, if you have a million dollars to put down you will most likely have better and safer alternatives.

But for those interested to check them out, here are the best peer to peer options according to investopedia

best peer to peer lending

Who knows, maybe you’ll find something you like.


Invest in art & collectibles

If you had a million dollars, there’s no way we’d let you spend it all on SUPREME gear or Jordans because “the reseller market is where it’s at bro”.

Although there is some truth to that, y’all are too young to know about beanie babies, but here’s an education for you. 

In the early 90s, instead of rare jordans and yeezys, people were reselling plush toys called beanie babies. The most expensive one sold for over $650,000, with many of them reselling between 10,000 and 50,000 dollars.

It’s safe to say it was a fad that went away… would you pay 50,000 for a plush toy today?

steg 50000 dollars ty

Of course you wouldn’t. Something similar is happening today with Hypebeast fashion.

The actual alternative asset class to invest in is actual ART. Art is the last loosely regulated market with prices constantly going up – at least when it comes to heritage pieces.

Very few people know this, but Blue chip art has outperformed the S&P500 for the past 20 years.

art vs s&p500

The problem here is, where do you even start? Unless you have someone who actually knows what the hell they’re doing you’re better off buying Bonds and leaving it at that.

But even the art market has evolved in the last couple of years. Once again, not a sponsor, but there’s this platform called Masterworks.io that allows you to invest in art in the same way you would have a Venture capital fund. The alternative is mutualart.com that shows when certain pieces come up for sale.

Our recommendation would be to never throw more than 10% of your net worth into alternative assets because even if you know what you’re doing there’s still an element of real value vs perceived value, which doesn’t apply when it comes to let’s say buildings or land. So be careful!


Buy a Franchise business

A million dollars buys you at least 1 mainstream franchise business. The beauty of the franchise model is that most business problems are already solved. All you have to do is be a great manager – or even better: find a good one – and your business will keep printing you cash.

Franchise businesses rely on a hefty investment but they provide you with the equipment, the training and the already established brand.

At this point in time if you’re looking to start a coffee shop business and a Starbucks opens next to you, you’re basically done, so.. Why wouldn’t you be the one opening the Starbucks?

Let’s break it down: You’ll need to pay an initial fee of somewhere between $40,000 and $90,000 to purchase the starbucks franchise, this covers the equipment & branding, and have a net worth of at least $250,000, with at least $125,000 of that liquid and ready to pour into the business in order to cover the initial running costs.

The franchise fee for a McDonalds is 45,000 dollars to which you add the property costs and initial day to day capital.

These are brands people love, Starbucks, Mcdonalds, Kfc, subway, Dunkin’, taco bell.. There are also cheaper options, but if you had a million dollar we would first open one spot in a good location and only then expand into more territories. 

A couple of weeks ago we also did a video on franchises that are blowing up right now that almost nobody watched.. here’s that video:



With land the deal is pretty straightforward. You buy the land -> you hold the land for some time -> You sell the land for massive profits.

We love land as an investment. Even the idea that you can literally own a piece of the Earth that you can leave to your children is, to this day, mind-blowing to us.

The basic formula for land acquisition is pretty simple: buy land 30 to 50 kilometers outside of any major city and wait 20 years. 

The world population is growing and for the foreseeable future, businesses will still concentrate their headquarters in large cities. People working in these corporations need housing near-by, thus the land outside the city is constantly developing. It won’t be long until developers come knocking on your door interested in building. These developers will either straight up want to buy the land from you or more often than not, work out a deal, where they cover the building cost, you provide the land and you split the profits.

If you have a million dollars worth of land and 20 years go by, just the sale of a small portion should be more than enough to solidify your rich status.

If you’re interested in playing the game, you can develop the land yourself, build apartment buildings or houses. 

Right now, we’re seeing a lot of potential with agricultural land that is not far from commercial hubs. You’re getting it 10 to 20 times cheaper and if the expansion of the city goes your way, it won’t be long until you have utilities and roads nearby. 


Emerging Markets

When we say Emerging markets we’re talking about two things:

  1. Developing countries
  2. Emerging trends

For example, we already know that India has a large population and right now telekom is booming as a business. This means that in the next decade almost 1 billion new people will be joining the online marketplace. These people will need to buy, sell, trade, use services and more. Same thing happening to south America and Africa. 

Every successful business in what is traditionally called “THE WEST” will be adapted and localized. 

In the US you have ZILLOW as the main real-estate portal and AMAZON as the main eCommerce store. Who’s gonna dominate these markets locally? Grass roots companies have the unfair advantage of understanding the customer better than these giants who aren’t as agile in development, so there is an opportunity to take your million dollars back to your home country and turn it into a fortune.

The other aspect has to do with Emerging trends and where the world is heading towards.

Tesla became the most valuable car company because Elon went all in on the electric car when nobody believed in the project and most people never considered they would ever buy an electric car.  

The transition from Petrol -> Electric is a trend.

Everything that was traditionally powered by petrol will soon rely on renewable energy.

Another big trend is riding the world of plastic. We hate the paper straws as much as the next guy, but it won’t be long until someone figures out a unique combination that’s maybe better than plastic without the turtles snorting them. 

Another trend we’re seeing has to do with consuming local foods. If you go into any supermarket right now, the tomatoes are from Mexico or Italy, the garlic is from Turkey or Egypt and so on.

How come it is cheaper to pack the collect the garlic in Egypt, put it on trucks, take it to the port, put it on a ship, carry it to here, house it and then distribute it in all the supermarkets for you to buy. Somehow all this middle man cost will be cut out at some point and whoever will figure it out will win this challenge.

If you have a million dollars to invest, we’ve outlined your best options. Personally, we would do a combination of 2 or 3 of these, but that’s us.

 At this point it’s just a matter of what you believe would make the most sense for you, which raised the question:

If you had to invest 1 million dollars, how would you do it? 

Join the thousands of Aluxers who are currently debating this in the comment section!

This wraps up our take on the best ways to invest $1 million today!