The 3 Smartest Places to Put Your Money in June 2023

Many people are struggling and stressed out these days due to factors like inflation and economic uncertainty. And unfortunately, a lot of people do not have a whole lot of cash at their disposal.

But what if you happen to have money you don't need for bill-paying purposes? If so, it's important to find the right home for your cash. Here are some options to look at.

1. A savings account

Because of all the recession warnings we keep hearing, it's important to have a solid emergency fund -- enough cash to cover at least three full months of essential bills. And that's why a savings account is a great place to stash some cash this month.

Not only are some high-yield savings accounts paying around or more than 4% interest, but the money you put into a savings account is protected, provided your bank is FDIC insured. Granted, that protection runs out once your deposit per bank exceeds $250,000 (per person on the account), but for most people, that's not a problem.

2. A certificate of deposit

Savings accounts happen to be paying generously these days. But you never know when your bank might start to pay less interest on your money. That's a chance you take when you stick to a regular savings account.

With a certificate of deposit, or CD, you're guaranteed the same interest rate for as long as your money is locked away. So if you sign a 12-month CD at 4.5%, you're guaranteed that 4.5% for a full year.

Of course, the problem with opening a CD is cutting off access to your money, as you're committing to keeping it tied up until your CD comes due. And tapping a CD early could result in penalties, which you don't want. But if you have separate funds set aside for emergency savings purposes, you may want to stick your remaining cash into a CD for a nice risk-free return.

3. The stock market

Savings accounts and CDs are paying 4% or more these days, and that's a nice return. But if you want an even higher return on your cash, consider investing it in stocks.

The stock market has averaged a 10% annual return over the past 50 years, as measured by the S&P 500 index. So, let's say you have $5,000 to work with. If you were to invest it in a bunch of different stocks, sit back, and do nothing over the next 25 years, you'd end up with a little more than $54,000, assuming your portfolio gives you a 10% return over time.

Now, one thing you should know is that that 10% return is by no means guaranteed. In fact, unlike a savings account or CD, when you put money into stocks, you risk losing some. But if you fill your brokerage account with a diverse mix of investments and hold them for many years, there's a good chance you'll make money over time.

Where should you put your money this month?

Clearly, there are plenty of options when it comes to your spare cash. So think about factors like how important it is to have immediate access to your money and how much risk you want to take on when deciding where to put it.

Also, think about your goals for that cash. If your primary objective is to grow it through the years, then the stock market might be the optimal choice for you.