Long story short, Im inheriting $5000, with this I am looking to turn a profit, should I invest it in bitcoin miners, or should I invest it in GICs and government bonds, or perhaps play with it in the stock market? Note: I am getting a bit ballsier with money, knowing how worthless it actually is.
Also, Im 24 years old, and I have to start thinking about my financial security for my future.
I'm guessing from "GIC" you're Canadian, so it does effect your options. However, I would say, absolutely not to GIC/government bonds. The yield is too low right now and you could lock yourself into a losing investment.
If you want to go low risk secure, then I would say to put it into an RRSP that has something similar to
Vangaurd Stable Value Fund. Contrary to the title, there is an interest payment, but there's no risk of loss (aside the basic systemic risk of the whole financial system collapsing). This is very liquid, though, and the interest rates will go up when the economy improves. Right now it's outperforming GICs by almost 3x. I personally keep a large amount of my retirement funds in something similar. The rest is in Bitcoin.
However, I don't think that this is really a good use for this money. There are a few things you can do with it:
- if you have any interest paying debt, pay that down.
- use it for a down payment for a home. Building equity is better than paying rent. Be smart about the purchase and realistic about your income and ability to perform repairs. The past few years have made people wary of buying property, but we have now moved through the worst of the effects of the bad loans, so personally I feel it is an ideal time to buy.
- buy personal supplies while they are on sale. Some famous investor (Warren Buffet? can't find a reference right now) when asked "what's the best investment a poor family can make with $100?" responded "An item they use daily on sale." Grocery stores often will discount common things you use to 50% off. Buy a 6 month supply.
Ok, that's the simple stuff. I would also say take $1000 at least and load an offline bitcoin wallet with that amount in bitcoins. It's a risk, but in all likelihood, that will outperform anything else you do with it.
You could also buy some gold or silver (I think silver is a better deal right now, but market conditions vary), but pay attention to the spot price versus the price you are buying. A lot of sellers on the internet will have you taking a 25% loss or more at the time of sale. You can get junk silver on ebay for pretty close to spot if you don't mind keeping a few bags of mismatched spoons.
If you want to go a little more active, you might try using it to buy items cheap at garage sales and putting them up on BitMit or ebay. Doing this too much on ebay will trigger Paypal requiring a business account and ebay performing Revcan reporting.