Investing $20,000 can be a powerful opportunity to build wealth — if you do it smartly. “A sound strategy is to allocate your $20,000 based on your current financial needs, your goals and your time horizon,” notes Alex Michalka, VP of investment research at Wealthfront. And Anthony Valeri, executive vice president and investment management director at California Bank & Trust, adds: “First and foremost, any investor should identify the goal of the money they are investing before buying any specific stock, fund or investment regardless of the dollar amount.”

For those looking to strengthen their investment strategy, we asked nine financial pros how they’d allocate $20,000. And if you’re looking for a pro to help you invest extra funds, you can find one at NAPFA, CFP Board or using this free tool that matches you to a financial adviser from our ad partner SmartAsset.

Diversify — Peter Reagan, financial market strategist at Birch Gold Group

“I would personally diversify the investments rather than consolidating them. This way, you get a balance of investments in stocks, fixed income and other alternative sources of income. Stocks are good sources of growth, fixed income or bonds are good sources of stability, and a pinch of something like gold or other alternative sources of income can help you cushion any uncertainty.

I would also keep some cash aside in case I need to take advantage of some opportunity sometime down the line. The division of the portfolio would depend on my risk tolerance, but the strategy would always be to diversify risks while not passing on the opportunities either.”

Optimize accounts that offer tax advantages — Alex Michalka, VP of investment research at Wealthfront

“Before committing funds to the market, a smart first step is to ensure you have an adequate emergency fund. For most people, this means setting aside enough cash to cover three to six months’ worth of living expenses …

Once your emergency fund is solidified, consider prioritizing accounts that offer tax advantages. For instance, a smart move is to max out your IRA for the 2025 tax year before the April 15, 2026 deadline if you haven’t already done so. For the remainder of the $20,000, a wise strategy is to invest it in a globally diversified portfolio of low-cost index funds personalized to your risk and optimized for taxes to work towards building long-term wealth.”

We like Costco, Microsoft and Nintendo — Bill Mann, chief investment strategist of Motley Fool Asset Management

“If you are looking to deploy $20,000 right now, do the thing that has always worked when given enough time — find the highest quality companies, measured by their ability to generate the largest returns from their invested capital, and hold tight. We think about companies like Costco, Microsoft, or even Nintendo from Japan, which have shown a tendency over time to generate market-beating financial results through significantly varied economic environments.”

Split it between gold and silver — Alexander Cooke, founder and principal at Optimist Capital

“Being a U.S.-based investor at this exact moment, $20,000 would be split into gold and silver, not something I ever thought I would say. But the fact is, the dollar is getting crushed from tariffs and less than reasonable actions from our political leaders. Because of this, we are not seeing actual gains in our market, we are seeing it tread water because of the devaluation of the dollar. One of the few ways to escape this is to purchase something the rest of the world covets, i.e. silver and gold.”

Prioritize your IRA accounts — Jace Graham, CEO and founder of Rising Phoenix Capital

“The best-designed investment plans in my opinion end up with a mix of some traditional IRA, some Roth for flexibility and tax-free income, and some taxable investments for liquidity. A lot of investors don’t realize that you can keep the same traditional IRA structure for tax purposes, but move it to a self-directed IRA custodian. A transfer from a traditional IRA at a mainstream brokerage to a traditional self-directed IRA is generally just a custodian-to-custodian transfer — it doesn’t, by itself, trigger taxes or penalties. What changes is what you’re allowed to invest in, not the fact that it’s still a traditional IRA.

My general advice is this: work with a financial planner and tax professional to model partial Roth conversions over several years, rather than making an all-or-nothing move. And if you’re interested in alternatives, talk with a firm that regularly works with self-directed IRAs and understands the mechanics of rollovers and real-asset investing.”

Don’t invest till you know your financial goals and time horizon — Ryan Haiss, CFP at Flynn Zito Capital Management

“I would not invest a dollar until the goal and time frame are clear. That is one of the biggest mistakes I see people make. The first question is how long you plan to invest the money. If the goal is short term, stocks are likely not the right place due to volatility and the risk of needing the money during a downturn. Once the purpose, timeline and risk tolerance are defined, you can build a diversified portfolio aligned to those goals rather than chasing whatever looks attractive in the market today.”

Invest in a well-diversified common stock index fund — Robert R. Johnson, CFA and professor of finance, Heider College of Business at Creighton University

“I would advocate placing 100% in a broadly diversified common stock index fund, assuming the investor’s time horizon was long and risk tolerance was high. According to data compiled by Ibbotson Associates, large capitalization stocks (think S&P 500) returned 10.4% compounded annually from 1926 to 2024. Over that same time period, long-term government bonds returned 5.0% annually and T-bills returned 3.3% annually.

If the investor’s time horizon is not long — say 10 years or less — then it would not be prudent to invest in the stock market. It also is not prudent to have significant exposure to the stock market if the investor does not have a sufficient appetite for risk. There is an old Wall Street adage that states, ‘you can sleep well or eat well.’ You will sleep well if you commit funds to low-risk investments like money market funds or Treasury bills, but your investments will not grow substantially and may even have trouble keeping pace with inflation. You will eat well by consistently investing in stocks.”

Put it in a HYSA — Jillian Stephenson, CPA and assistant teaching professor at Carnegie Mellon University’s Heinz College

“If I were to invest $20,000 right now, I would consider putting it in a high yield savings account. It may be conservative, but [it] gives you access to your funds without risk since it’s FDIC insured.”

Diversify your strategy using different equity sectors — Anthony Valeri, executive vice president and investment management director at California Bank & Trust

“We recommend a diversified approach that includes mostly U.S. large-cap stocks in addition to international and small- and mid-cap stocks. That hasn’t worked as well in recent years as a handful of mega-cap tech companies have dominated market performance. That concentration presents a risk; however, last year that started to change. Additionally, since November, a host of market segments, like small-cap stocks, value stocks, international and EM (emerging market) stocks have outperformed the S&P 500. We believe that will continue. Bonds also bounced back after suffering through a historic bear market.

There are single mutual funds and ETFs that make it easy to get broad market diversification for $20,000, but if desired, an investor can find specific investment vehicles for the equity categories mentioned above.”