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I realize that not everyone has $100,000 sitting around, but if you’re currently working on dumping debt and building wealth – and are committed to your goals – that 100k will show up in your financial portfolio quicker than you think it will. Investing that money properly has the potential to make it grow exponentially, thanks to the wonder of compound interest. Today I’ll share some ideas on how to invest $100k for those who are looking for ways to compound their wealth growth.

The wealthy have a different mindset about money. I’m not speaking here about the “I won the lotto” wealthy – I’m speaking of those who have amassed true wealth: those who’ve sacrificed and worked hard earning and managing their money in order to build wealth. The truly wealthy are wealthy because they understand the value of a dollar. They aren’t as willing to spend their hard-earned cash on material items such as yachts and mansions, but they are willing to research and invest in investments that have the potential to grow their wealth, because the promise of continued financial security is more important to them than the temporary gratification that comes with the purchase of “stuff.”

Create A Plan for Investing Your Money

When you get to that point in your walk toward financial independence – the point where the promise of financial security is more important than the lure of stuff – and you’re working to research investment ideas that will help you grow your wealth, here are some investment options you might consider as you ponder how to invest that $100,000 you’ve worked so hard to acquire.

1. Real Estate

Nothing has staying power as far as investments go like investing in real estate does. Whether it’s raw land, rental properties or some other form of real estate, the real estate market has shown itself to be a rock solid investment time and time again. When considering using your $100k to invest in real estate, you’ve got many options. Depending on where you live, $100,000 could be a nice down payment on a single-family home, a duplex or a condo, or in some areas, could be the full purchase price for those items. It could also be a nice down payment for a smaller apartment building in some areas.

Not interested in getting into the real estate rental market? Consider investing your money in a raw land purchase. This could mean raw land that has potential for later development, or raw land containing a valuable resource such as trees. No matter what your real estate purchase, real estate in the long-term has a solid history of growing steadily in value and increasing wealth for those investing in it.

2. Start or Invest in a Business

If you or someone you know has a banner business idea, this might be just the avenue for you to take your $100,000 and make into a much bigger pile of cash. Investing in businesses requires due diligence on what the potential is for said business, however, so before laying down any cash, be sure to educate yourself thoroughly on potential wins and losses the business could suffer, as well as researching if there is truly a need for said business idea. Take a cue from business investment experts and analyze any business investment opportunities with a critical eye, looking out for your own monetary best interests first as you consider investing in any business. The business with the most potential for success and profit is a business or business idea that has proven a need for their good or service, and has created a solid business plan with hard-core facts to back it up.

3. Invest in Index Funds

I love index funds. They allow for the growth history that the stock market has shown to be true, while still providing the safety net of diversity and generally low fees to boot. Investor Place tells us in its review of Vanguard index funds, for instance, that many Vanguard funds have a 10-year performance rate of 9-11% and higher.

Because index funds generally contain stocks from a wide variety of proven-performance industries and companies, they have a terrific success rate and have shown to be a solid choice for investors world-wide. Index funds are often the closest thing you’ll get to a sure bet in the investment world. When it comes to investing in the stock market, you need to have a brokerage account. If you don’t already have an investment account, check out Tradeking as they are only $4.95 per trade.

4. Diversify your money

Another great option for investing $100,000 might be to break it up and diversify it into several different investment choices. For instance, you might want to put $25k into real estate investing as a down payment on a smaller house or condo if market prices in your area or a nearby area are lower. From there you could take another $25,000 and invest it in index funds. Consider taking another share and put it into large cap stock fund, some into international stock fund, etc. By diversifying how you invest your $100,000, you run even less risk of losing the money and gain more experience in investing as you learn which types of investments suit your personal investment style and which don’t.

History – along with millionaires and billionaires world-wide – has proven that investing your money is the surest road to building wealth for the long-term. Properly invested, even the smallest investment will pave the way to greater wealth over time. For that reason, it would be a smart idea to work to educate yourself now on the various types of investments that are available, what their risks and rewards are, and whether or not each type of investment is right for you.

From there you can pick the types of investments that best suit your individual investing style and have the greatest potential of producing the wealth that you want in order to reach your financial goals.