How to Double Your Money


5 ways to double your assets through investment

There are various ways to double your money depending on your timeline and your risk tolerance. You don’t have to buy speculative investments. A carefully balanced portfolio or even one that’s just filled with super low-risk bonds can get the job done if you’re patient.

Doubling your money is a prospect that few people would turn down and it isn’t necessarily that difficult to achieve.


  • There are five key ways to double your money ranging from a conservative strategy of investing in savings bonds to an aggressive approach involving speculative assets.
  • The classic approach of doubling your money involves investing in a diversified portfolio of stocks and bonds and is probably the one that applies to most investors.
  • Investing to double your money can be done safely over several years but there’s more of a risk of losing most or all of your money if you’re impatient.
  • Be honest about your risk tolerance. Don’t let greed and fear hurt your investment decisions and be extremely wary of get-rich-quick schemes.
  • One of the best ways to double your money is to take advantage of retirement and tax-advantaged accounts offered by employers such as 401(k)s.

Five Ways to Double Your Money

Doubling your money is a realistic goal that most investors can strive toward and it’s not as daunting a prospect as it may seem. There are a few caveats, however:

  • Be very honest with yourself (and your investment advisor, if you have one) about your risk tolerance. Finding out that you don’t have the stomach for volatility when the market plunges 20% is the worst possible time to make this discovery and it may prove detrimental to your financial well-being.
  • Don’t let greed and fear hurt your investment decisions.
  • Be extremely wary about get-rich-quick schemes that promise you “guaranteed” sky-high results with minimal risk. There’s no such thing.

1. The Classic Way

Investors who have been around for a while will remember the classic Smith Barney commercials from the 1980s in which British actor John Houseman informs viewers that “they make money the old-fashioned way—they earn it.”

That commercial isn’t too far from the truth when it comes to the most traditional way of doubling your money. The time-tested way over a reasonable amount of time is to invest in a solid, balanced portfolio that’s diversified between blue-chip stocks and investment-grade bonds.

The S&P 500 Index is the most widely followed index of blue-chip stocks. It returned about 9.8% annually (including dividends) from 1928 to 2020. Investment-grade corporate bonds returned 7.0% annually over these 93 years.1 A classic 60/40 portfolio (60% equities, 40% bonds) would have returned about 8.7% annually during this time. A 60/40 portfolio should double in about 8.3 years and quadruple in approximately 16.5 years based on the Rule of 72.

But note that a significant amount of volatility generally accompanies such sterling results. Investors should brace themselves for occasional sharp drawdowns such as the 35% plunge in the S&P 500 within six weeks in the first quarter of 2020 as the coronavirus pandemic erupted worldwide.

Very high returns compared with the historical norm may also reduce the potential for future returns. The S&P 500 recovered from its 2020 plunge in record time and powered its way to new record highs by year-end 2020. It returned a jaw-dropping total return of 100% from 2019 to 2021 but future returns could be significantly lower.

S&P 500 Doubles in Three Years!

The S&P 500 delivered a phenomenal total return of 100% in the three years from 2019 to 2021 despite plunging 35% within six weeks in February and March of 2020. An investor who held an investment like the SPDR S&P 500 ETF (SPY) over those three years would have seen it double in value.

What About Real Estate?

Real estate is another traditional way to build wealth but it’s a far less attractive proposition at times when housing prices in North America surged to record levels. The possibility of rising interest rates also reduces the appeal of real estate investment.

That said, the prospect of doubling one’s money proves irresistible to many investors during a real estate boom because the huge amount of leverage provided by mortgage financing can juice up returns.

A 20% down payment on an investment property worth $500,000 would require an investor to plunk down $100,000 and get a mortgage for the balance of $400,000. The investor now has equity worth $200,000 in the property, which represents a doubling of the original $100,000 investment, if the property appreciates 20% to $600,000 in the next few years.

2. The Contrarian Way

Even the most unadventurous investor knows that there comes a time when you must buy, not because everyone is getting in on a good thing but because everyone is getting out.

Just as great athletes go through slumps, the stock prices of otherwise great companies occasionally do as well. This accelerates as fickle investors bail out. As Baron Rothschild supposedly once said, smart investors “buy when there is blood in the streets, even if the blood is their own.”2

Nobody is arguing that you should buy garbage stocks. The point is that there are times when good investments become oversold and this presents a buying opportunity for investors who have done their homework.

Valuation metrics used to gauge whether a stock may be oversold include a company’s price-to-earnings ratio and book value. Both measures have well-established historical norms for the broad markets and specific industries. Smart investors smell an opportunity to double their money when companies slip well below these historical averages for superficial or systemic reasons.

Being contrarian means that you’re going against the prevailing trend. It requires a greater degree of risk tolerance and a substantial amount of due diligence and research. A contrarian strategy is best left to very experienced investors. It’s not recommended for a conservative or inexperienced investor.

3. The Safe Way

Just as the fast lane and the slow lane on the highway will eventually get you to the same place, there are quick and slow ways to double your money. Bonds can be a less hair-raising journey to the same destination if you prefer to play it safe.

Consider zero-coupon bonds. They may sound intimidating for the uninitiated but in reality, they’re simple to understand. You buy a bond at a discount to its eventual value at maturity instead of purchasing a bond that rewards you with a regular interest payment.

One hidden benefit is the absence of reinvestment risk. Standard coupon bonds come with the challenges and risks of reinvesting the interest payments as they’re received. There’s only one payoff with zero-coupon bonds and it comes when the bond matures.

On the flip side, zero-coupon bonds are very sensitive to changes in interest rates. They can lose value as interest rates rise. This is a risk factor to be considered by an investor who doesn’t intend to hold a zero-coupon bond to maturity.

Series EE Savings Bonds issued by the U.S. Treasury are another attractive option for conservative investors who don’t mind waiting a couple of decades for the investment to double. Series EE Savings Bonds are low-risk savings products that are only available in electronic form on the TreasuryDirect platform.3 They pay interest until they reach 30 years or the investor cashes them in, whichever comes first.

The rate of interest was a paltry 0.10% for bonds issued from November 2021 to April 2022 but they came with a guarantee that bonds sold then would double in value if held for 20 years. The minimum purchase amount was $25 and the maximum purchase per calendar year was $10,000. Savings bonds are exempt from state or local taxes but interest earnings are subject to federal income tax.4

4. The Speculative Way

Slow and steady might work for some investors but others find themselves falling asleep at the wheel. For folks with a high degree of risk tolerance and some investment capital that they can afford to lose, the fastest way to supersize the nest egg may be the use of aggressive strategies. These include optionsmargin tradingpenny stocks, and cryptocurrencies. But all of them can super-shrink a nest egg just as quickly.

Stock options such as simple puts and calls can be used to speculate on any company’s stock. Options can turbocharge a portfolio’s performance for many investors, especially those who have their fingers on the pulse of a specific industry.

Each stock option potentially represents 100 shares of stock so a company’s price might have to increase only a small percentage for an investor to hit one out of the park. Just be careful and be sure to do your homework before trying it.

Those who don’t want to learn the ins and outs of options but do want to leverage their faith or doubts about a particular stock have the option of buying on margin or selling a stock short. Both of these methods allow investors to essentially borrow money from a brokerage house to buy or sell more shares than they have. This in turn raises their potential profits substantially.

This method is not for the faint of heart. A margin call can back you into a corner and short selling can generate infinite losses.

Extreme bargain hunting can turn pennies into dollars. You can roll the dice on one of the numerous former blue-chip companies that have sunk to less than a dollar or you can sink some money into a company that looks like the next big thing. Penny stocks can double your money in a single trading day. Just keep in mind that the low prices of these stocks reflect the sentiment of most investors.

Cryptocurrencies have also emerged as one of the favored ways for speculators to make a quick buck as Bitcoin has grown in popularity and become more mainstream.

Bitcoin surged 60% in 2021 although its performance pales in comparison with that of as many as 10 other cryptocurrencies with a market capitalization of at least $10 billion that soared 400% or more in 2021. These include EthereumCardanoShiba InuDogecoinSolana, and Terra. Solana and Terra gained more than 9,000% in 2021 but they saw sharp declines in 2022.56

Unfortunately, the cryptocurrency arena is a fertile hunting ground for scamsters and there are numerous instances of crypto investors losing a great deal of money through fraud. Would-be cryptocurrency investors should take the utmost care when putting their hard-earned money into any cryptocurrency.

5. The Best Way

It’s not nearly as much fun as watching your favorite stock on the evening news but the undisputed heavyweight champ is an employer’s matching contribution in a 401(k) or another employer-sponsored retirement plan. It won’t wow the neighbors but getting an automatic 50 cents for every dollar you save is tough to beat.

Even better is the fact that the money you put into your plan comes right off the top of what your employer reports to the Internal Revenue Service (IRS).7 Each dollar invested costs most Americans only 65 to 75 cents.

You still can invest in an individual retirement account (IRA), either traditional or a Roth, if you don’t have access to a 401(k) plan. You won’t get a company match but the tax benefit alone is substantial. A traditional IRA has the same immediate tax benefit as a 401(k). Roth IRA contributions are taxed in the year the money is invested but no taxes are due on the principal or the profits when the money is withdrawn at retirement as long as you meet the age and time-invested requirements.8

Either type of IRA is a good deal for the taxpayer but think about that Roth IRA if you’re young. Zero taxes on your capital gains is an easy way to get a higher effective return. The government will even effectively match some portion of your retirement savings if your current income is low. The Retirement Savings Contributions Credit reduces your tax bill by 10% to 50% of your contribution.9

Time Horizon and Risk Tolerance

Your investing time horizon is an extremely important determinant of the amount of investment risk you can handle and it’s generally dependent on your age and investment objectives.

A young professional likely has a long investment horizon so they can take on a significant amount of risk because time is on their side when it comes to bouncing back from any losses. But what if they’re saving to buy a house within the next year? Their risk tolerance will be low in this case because they can’t afford to lose much capital in the event of a sudden market correction. This would jeopardize their primary investment objective of buying a home.

Conventional investing strategy suggests that people who are in or near retirement should have their funds deployed in safe investments like bonds and bank deposits. But that strategy carries its own risk in an era of extremely low interest rates, mainly the loss of purchasing power through inflation. A retired individual in their 60s with a decent pension and no mortgage or other liabilities probably would have a reasonable amount of risk tolerance.

An investment that has the potential to double your money in a year or two is undoubtedly more exciting than one that may do so in 20 years. The issue here is that an exciting, high-growth investment will almost certainly be far more volatile than a staid, “Steady Eddy” type of investment. The higher the volatility of an investment, the riskier it is. This increased volatility or risk is the price an investor pays for the allure of higher returns.

The Risk-Return Tradeoff

The risk-return tradeoff refers to the fact that there’s a strong positive correlation between risk and return. The higher the expected returns from an investment, the greater the risk. The lower the expected returns, the lower the risk.

How Long Does It Take to Double Your Money?

The Rule of 72 is a well-known shortcut for calculating how long it will take for an investment to double if its growth compounds annually. Just divide 72 by your expected annual rate of return. The result is the number of years it will take you to double your money.

The Rule of 72 provides a fairly accurate estimate of doubling time when dealing with low rates of return. However, that estimate becomes less precise at very high return rates as can be seen in this chart. It compares the estimates for “time to double” (in years) generated by the Rule of 72 with the actual number of years it would take for an investment to double in value.

Rate of ReturnRule of 72Actual Number of YearsDifference (Number) of Years

What’s the Single Best Way to Double Your Money?

It depends on your risk tolerance, investment time horizon, and personal preferences. A balanced approach that involves investing in a diversified portfolio of stocks and bonds works for most people. However, those with higher risk appetites might prefer dabbling in more speculative stuff like small-cap stocks or cryptocurrencies. Others may prefer to double their money through real estate investments.

Can Investors Use All Five Ways in the Quest to Double Their Money?

Yes. If your employer matches contributions to your retirement plan, take advantage of that perk. Invest in a diversified portfolio of stocks and bonds and consider being a contrarian when the market plunges lower or rockets higher. Allocate a small portion of your portfolio to more aggressive strategies and investments after doing your research and due diligence if you have the risk appetite and want some sizzle on your steak. Save regularly to buy a house and keep the down payment in a savings account or other relatively risk-free investment.

Should I Invest in Cryptocurrencies if I’m a Conservative Investor With Very Low Risk Tolerance?

No, you should not invest in cryptocurrencies if you are a conservative investor with a very low risk tolerance. Cryptocurrencies are very speculative investments and their tremendous volatility makes them unsuitable for conservative investors even though many of them had huge returns in 2021.

The Bottom Line

Broadly speaking, there are five ways to double your money. The method you choose depends largely on your appetite for risk and your timeline for investing. You might also consider adopting a mix of these strategies to achieve your goal of doubling your money.

There are probably many more investment scams out there than there are sure bets so be suspicious whenever you’re promised results that appear too good to be true. Whether it’s your broker, your brother-in-law, or a late-night infomercial, take the time to make sure that someone isn’t using you to double their money.

Disclosure: This article is not intended to provide investment advice. Investing in securities entails varying degrees of risk and can result in partial or total loss of principal. The trading strategies discussed in this article are complex and should not be undertaken by novice investors. Readers seeking to engage in such trading strategies should seek extensive education on the topic.

Compete Risk Free with $100,000 in Virtual Cash

Put your trading skills to the test with our FREE Stock Simulator. Compete with thousands of Investopedia traders and trade your way to the top! Submit trades in a virtual environment before you start risking your own money. Practice trading strategies so that when you’re ready to enter the real market, you’ve had the practice you need. Try our Stock Simulator today >>

اترك ردّاً

لن يتم نشر عنوان بريدك الإلكتروني. الحقول الإلزامية مشار إليها بـ *