The 5 Best Places to Put Your Money in 2024

It can be tricky to know where the best place to put your money is, especially if you're new to managing your money, or you're just earning more this year. There are tons of options, from savings accounts to brokerages, to the underside of your mattress (though, that one's probably not the best option, if we're splitting hairs).

To help you start, here are the five best places to put your money in 2024, and why they work.

1. Emergency savings account

There is always a good reason to have an emergency fund: You can't predict what may happen in the future, and how much that's going to cost. And if you do encounter an expensive financial need, like a car or home repair, you may have to resort to high-interest debt, increasing those costs even more. So if you don't have an emergency fund in place, there's no better time to start one than now.

As a general rule, you should have at least three months' worth of necessities saved up, but this can range up to 12 months' worth for those who have less stable incomes. That sum includes rent, utilities, groceries, and minimum debt payments. That way, if something comes up that disrupts your income or budget, you'll be better prepared to handle it.

2. High-interest debt payoff

Right now, interest rates are especially high. And if you have high-interest debt, like credit cards, you're probably feeling the sting of those increased rates. So it makes sense to pay those down as much as you can (without sacrificing too much on saving for emergencies) to save on interest.

As rates fall, as they very well could in the future, this may not feel as pressing. But ultimately, high-interest debt can be difficult to pay off and lead to more debt, so it should always be a priority to eliminate that debt as soon as possible.

3. High-rate CDs

On the flip side, high-rate environments provide the opportunity to earn more in interest on bank accounts like CDs. So if you have money that you can part with for several months to a year (or longer), then you'll be able to lock in the high APYs we're seeing right now, guaranteeing those returns even if rates fall during the course of your CD.

For example, a 5% APY on a 6-month, $5,000 CD would earn $125 in interest. Just make sure you won't need that cash before the term ends, otherwise you'll have to pay an early withdrawal penalty.

4. High-yield checking account

Checking accounts do an important job: They allow you to manage your everyday finances. But that doesn't mean you shouldn't expect to earn interest on that account. In fact, if you're currently using a no- or low-interest checking account, you're leaving money on the table. Current rates on these accounts can be as high as 5%. So for a $5,000 balance, that would translate to $250 in interest per year.

Of course, rates could shift over time, so that is not guaranteed money. But it's still going to offer better returns than regular checking accounts, which may not offer interest at all.

5. Tax-advantaged retirement accounts

Whether you're earning more this year, or you're breaking into a new career, saving for retirement is always a good idea. And, thanks to the existence of tax-advantaged retirement accounts like 401(k)s and traditional IRAs, you can reduce your taxable income by contributing to those accounts, too. For instance, if you max out your 401(k) contributions -- which would be a total of $23,000 for 2024 -- and earn $100,000 a year, you'd reduce your taxable income to $77,000 based on that change alone.

Of course, this can be difficult to pull off, depending on your income. So, as a general rule, try to at least get the full match your employer offers, if it offers one. That way, you won't be losing out on free money for retirement.

If you plan on earning more in retirement, however, you may want to consider using a Roth IRA, which doesn't impact your current taxes. Instead, that lets you take out that money tax free in retirement. So you may want to split your contributions to access the best mix of tax advantages for your retirement plans.

Managing your finances can be tricky. But, if you take the time to understand how certain accounts work, and pay attention to the interest-rate environment, you can more easily select the best options for your circumstances. You just have to be willing to do the legwork.