How to invest the first couple of thousands of dollars earned, increase income

When you think of different ways to invest your money, things like the stock market or real estate may come to mind.

But investing can mean more than buying an asset and hoping it will increase in value over time.

“Investing at its core is about committing resources to achieve future returns,” says accountant and former investment banker Nischa Shah on her YouTube channel. One form of investment is spending money, time and energy on personal development, which could mean enrolling in a course to learn a new skill or hiring a coach to help you with your business.

“It’s one of the best ways to invest $1,000, but it’s also the most overlooked because people don’t think about the long-term benefits when you invest in something that’s not necessarily tangible,” said Shah, who saved six figures. before she quit her corporate job to work for herself. After all, you can’t easily track returns like you can with an index fund. However, “when you invest in yourself, you’re essentially increasing your earning potential and creating more opportunities for yourself.”

Business Insider caught up with Shah on how to invest your first $1,000 to $5,000. She explained why you should consider investing in yourself before putting your money to work in the stock market or real estate.

The purpose of investing in yourself is to create more earning opportunities – and more income means more money to save and invest

Keep in mind that before you invest in anything—including yourself—experts recommend paying off high-interest debt first and setting aside three to six months’ worth of expenses in an emergency fund.

Once you have a solid financial foundation, you can (and should) figure out how to put your money to work.

Shah’s advice is to start with yourself: “When it comes to the first $1,000 or the first $5,000, invest it in yourself before you invest it in anything else. Because the return you can get on your investment completely outweighs the 7% return you’ll get. in the stock market over the next 30 years.”

nischa chess

Shah has multiple streams of income, from YouTube AdSense to speaking gigs.

Nischa Shah

Developing an existing skill or building a new one can give you the qualifications to land a higher paying job; taking a $1,000 negotiation course can result in a 20% raise; hiring a business coach can help you start a side hustle or take an existing one to the next level; attending a networking conference can put you in the same room as your future business partner or mentor.

Especially if it took you a long time to build your first two thousand dollars, “what you want to focus on is making or making more money,” Shah added. “Use that $5,000 in a way that will build you more valuable skills.”

Then, if you’ve grown your income inside your day job or built a second income stream outside of your 9-to-5, you’ll have more that you can invest as you see fit in the stock market, real estate, or businesses. others.

Building multiple streams of income

Investing in yourself can help you earn a raise at your day job—and that’s a great start—but think beyond your 9-to-5.

“If you rely on just one revenue stream, it’s pretty close to none,” Shah said, especially during economically uncertain times like now when companies in various industries are downsizing. “Having other streams of income that can keep you going if one of them goes down will protect you.”

Shah, who has amassed nearly 1 million subscribers on YouTube, says her main stream of income is YouTube AdSense. It also earns revenue from its real estate portfolio, speaker events, brand partnerships and affiliate marketing.

Her top tip for starting a side hustle is to start with a skill or hobby you already have. For example, as an accountant and banker, she was already answering money questions from her friends and family and thought, why not do it on a bigger scale? She filmed and edited a video about a real estate investment strategy she had been using and uploaded her first video to YouTube in 2021.

Chess is in what she categorizes as a “content-based business,” but you could consider the business model to be product-based (selling a physical or digital product) or service-based (something like one-on-one coaching or physical training). .

“Think about how you can incorporate what you want to do into what you’re already doing, because that’s the way to get started right away,” she said — and getting started is the most important step. You don’t want to get to the point where you look back and think, “I wish I had started. I wish I just went for it. I’ve spent the last three or five years thinking about it, reading all books about it, taking courses about it. But I just didn’t do that.”

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