My fiancé and I have about $100k in a high-yield savings account from our retail e-commerce clothing store, which has generated $810k in revenue since July 2023. We’re keeping the store running but want to diversify our income. We’re getting married in 2026 with a budget of $18-20k and plan to buy a house soon after .
We’ve considered buying laundromats or equipment rental businesses with low overhead for semi-passive income, but this would require an SBA loan and 1-3 years to recoup the down payment. While I know a bit about stocks , I’m only comfortable with investing in solid index funds. Investing in a new business feels too risky for me right now
Starting with $100,000 to generate passive income opens up a wide range of opportunities! Here are some popular strategies often discussed on MONEYFRONTS and other financial forums:
Real Estate:
Rental Properties: Purchasing rental properties can create a reliable income stream. Be sure to consider factors like location, potential rental income, and the need for property management.
Real Estate Investment Trusts (REITs): These allow you to invest in real estate without directly owning properties. REITs typically pay dividends, making them a more hands-off investment option.
Dividend Stocks:
Investing in stocks that pay dividends can provide a regular income. Focus on companies with a solid history of consistent and growing dividend payments.
Index Funds and ETFs:
These investment options offer diversification and steady returns, making them less risky than individual stocks and a reliable source of passive income.
High-Yield Savings Accounts or CDs:
Though not as high-yielding as other investments, these are low-risk and offer a guaranteed return, making them a safer choice for passive income.
Peer-to-Peer Lending:
Platforms like LendingClub or Prosper let you lend money to individuals or small businesses in exchange for interest payments, offering another way to generate income.
Starting a Business:
If you have a business idea that requires minimal involvement, it can be a great avenue for creating passive income.
Alternative Investments:
Consider putting your money into art, wine, or even cryptocurrencies. These options carry more risk but can potentially offer higher returns.
Each strategy comes with its own set of risks and rewards, so diversifying your investments and consulting with a financial advisor to align your strategy with your goals and risk tolerance is key.
I would put my money in an S&P 500 fund like VOO, which invests in the top 500 or so largest U.S. companies. Over time, it’s likely to outperform a high-yield savings account, especially if you don’t need immediate access to the cash.
When they mention “a long enough time horizon,” they mean that over a single year, a high-yield savings account (HYSA) might give you a 5% return. However, if you invest in VOO at the worst possible time, you could be down 6%, though there’s also a chance you could be up 10%. In such a short period, it’s tough to predict.
Over a longer time frame, the likelihood of achieving an average annual return of around 7% with VOO increases, while the HYSA would likely stay around 5%. Five years isn’t long enough to statistically guarantee that VOO will outperform the HYSA, but with good timing, you could see a 6% gain in just a week.
I’m fairly certain that SPY and VOO have had plenty of 12-month periods where starting investments ended up with losses exceeding 6% over that time. These are generally long-term investments and aren’t ideal for money you’ll need within the next 12 months.
We’re getting married in 2026 with a budget of $18-20k 
and plan to buy a house soon after 
.
While I know a bit about stocks 
, I’m only comfortable with investing in solid index funds. Investing in a new business feels too risky for me right now