Best Way To Invest $10K

Here's What I'd Do If I Had To Invest My First $10,000 Again

🖥️ Reading time: 6 minutes

Let’s cut to the chase. If you’ve got $10,000 to invest and don’t know where to start, you’re in the right place. I’ve been there, made mistakes, and learned the hard way. Now, after hitting a portfolio of more than a million, I know exactly how I’d invest my first $10K if I were starting over today.

Step 1: Put $3,000 to $4,000 in the S&P 500

If you want to build wealth without losing sleep at night, start here. The S&P 500 is basically the honor roll of the stock market, made up of 500 of the biggest and most successful U.S. companies like Microsoft, Google, Amazon, and Visa.

Investing in an S&P 500 index fund means you’re betting on America’s biggest businesses winning over the long haul. Historically, the S&P 500 has returned 7% to 12% per year, but here’s the catch: some years it tanks, and some years it soars. The key is to stay invested long term.

For ETFs, I personally like SPY because it’s the most traded ETF, meaning better liquidity for selling covered calls. But if you’re not into options trading, VOO, SPLG, IVV, or FXAIX are great alternatives.

📌 Pro-tip: Always check the expense ratio of a particular stock. Less than 0.5% is the way to go.

Step 2: Put $3,000 in the NASDAQ 100 (Tech Stocks)

If you’re younger and have time on your side, betting on tech is a smart move. Tech companies are more volatile, but they also have the highest growth potential.

The NASDAQ 100 is a basket of the top 100 non-financial companies in the U.S. dominated by tech giants like Apple, Nvidia, Tesla, Meta, and Google. Investing in this index means you’re backing the future of innovation. The ETF I like for this is QQQ.

📌 Pro-tip: If the share price is too high, QQQM is a cheaper alternative that tracks the same index.

Step 3: Put $2,000 in Dividend-Paying ETFs

Dividends are the ultimate passive income hack. They provide stability when the market is shaky and give you cash flow regardless of stock prices.

For dividend-focused ETFs, SCHD is my go-to. It holds high-quality companies like Pepsi, Coca-Cola, and Home Depot, which have a track record of consistently paying dividends. These stocks don’t grow as fast as tech stocks, but they provide a buffer against market downturns.

📌 Pro-tip: Sign up for my Beginners Investing Master Class today to learn more about dividend-paying ETFs.

Step 4: Keep $1,000 in Cash

You might be thinking, “Why hold cash? Shouldn’t I invest everything?” Here’s why: market dips are your best buying opportunities.

Keeping 5% to 10% of your portfolio in cash allows you to pounce when the market pulls back. Instead of panicking, you’ll be loading up on stocks at a discount. 

📌 Pro-tip: If you use a brokerage like Fidelity, your uninvested cash can sit in a money market account earning 4% to 5% interest.  

Alternative Allocations Based on Your Risk Tolerance

Final Thoughts: Invest Based on YOUR Risk Tolerance

At the end of the day, there’s no one-size-fits-all investment plan. Your strategy should match your comfort level and goals. But if I were starting over, this is exactly how I’d invest my first $10,000.

One last thing—don’t just take my word for it. Do your own research. Investing is about making smart, informed decisions that work for you.

If you’re serious about building a high-dividend portfolio for passive income, check out my FREEsources and courses.

✅ Join My Beginners Investing Master Class

✅ Take advantage of my FREE Financial Freedom Faster eBook

✅ Get in touch

📢 Final Tip: Start TODAY—your future self will thank you!

- Steve

Disclaimer:

The following article is strictly the opinion of the author and is not to be considered financial/investment advice. CTL Community LLC and the author of this article do not claim to be a registered financial advisor (RIA) or financial advisor. Please visit our terms of service and privacy policy before reading this article.  "Call to Leap may earn affiliate commissions from the links mentioned. Call to Leap is part of an affiliate network and receives compensation for sending traffic to partner sites such as ImpactRadius, CardRatings, MyBankTracker, and more."