Have $100K in Cash? Here Are the 4 Best Places to Put It

So you've got $100,000 in cash… Now what?

You could blow it on a brand-new Tesla, rent a private island for a week, or order avocado toast for every meal for the next 20 years. (No judgment.)

But let's be honest: That money took time and effort to earn. If you want it to last (or better yet, grow), you need a smarter plan than just leaving it in a regular checking or savings account.

Here are four smart moves for putting your $100,000 to work.

1. Open a high-yield savings account

Let's start with the obvious: Don't leave $100,000 in a checking account earning 0.01% interest.

It's way better off in a high-yield savings account (HYSA) earning maximum interest.

Right now, top online banks are offering 4.10% - 4.40% APY for high-yield accounts. That's about $350 per month you can collect in interest -- just for parking your money in a better spot.

Your money is very safe in an HYSA. Accounts are FDIC insured (up to $250,000 per depositor), and most banks don't charge monthly fees or have minimum balance requirements. You can also access your cash anytime.

Even if you only move $50,000 into an HYSA, you could make an easy $2,000 a year in passive income, with no additional risk. It's a great way to earn high interest, without locking up any of your cash.

2. Set up a CD ladder

A certificate of deposit (CD) is when you lock in your money for a set period of time, with a guaranteed return. And right now, many banks are offering 4.00% APY for short-term CDs.

But instead of dumping all your $100,000 into a single CD, consider spreading it across multiple CDs with a "laddering" strategy.

Here's what a potential CD ladder would look like:

1. Split your $100,000 into four equal parts ($25,000 each)
2. Open CDs with staggered terms: 6, 12, 18, and 24 months
3. As each CD matures, you can withdraw that $25,000, or roll it into a new 24-month CD

The goal is to lock in today's high rates, but also keep cash flowing back to you regularly.

A CD ladder works especially well if you're saving for short-term goals like a home down payment, new car, or an epic vacation.

We monitor the top banks so you don't have to. Check out the best CD rates for May 2025 and start building your ladder today

3. Invest for long-term growth

If your emergency fund is solid and you don't have any short-term saving goals, investing most of your cash is the smartest thing you can do.

Let's say you invest $50,000 into a low-cost S&P 500 index fund. Here's what that could grow into, assuming 8% average annual returns:

And if you invested all $100,000? Double those figures above.

Einstein said that compound interest is the eighth wonder of the world. I agree, it's incredible.

A smart first move is to open a tax-advantaged IRA -- either traditional or Roth -- depending on your income and retirement goals. This lets you grow part of your money tax-free or tax-deferred, which can make a huge difference over time.

Once you've maxed out your IRA contribution for the year, putting the rest into a low-fee online brokerage account gives you the flexibility to invest in stocks, ETFs, or bonds without contribution limits.

Just remember: Markets go up and down. But staying invested over decades is one of the best ways to build wealth.

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4. Keep some cash on hand -- strategically

While it's tempting to put every dollar to work, it's smart to keep a cash cushion for life's curveballs.

A good rule of thumb is to keep three to six months of expenses in cash (and in a high-yield account). For most people, that's around $20,000 to $30,000.

For big upcoming purchases like buying a rental property or launching a business, keep those savings liquid or in short-term accounts like CDs.

But once you've set aside what you need short term, you can confidently invest the rest with a long-term mindset.

The bottom line

Having $100,000 in cash is a great problem to have. You worked hard to earn those dollars. Now it's time to make those dollars work hard for you.