How I would invest $1,000 in 2022!

How I would invest $1,000 in 2022!

Do you have $1,000 that you don’t need for any upcoming bills?

Do you want to get started with investing?

Now let me tell you how I would approach reasoning through the different options for investing $1,000.

1-S&P 500:

If we look at the previous 40 years on average the S&P 500 has returned around 9.4%.

So let’s look at what $1,000 at 9.4% will yield us at different investment horizons.

Here we’re assuming we are achieving the average annual return that the S&P 500 has achieved over the last 40 years which is 9.4%.

  • 10 years of investment: After 120 months the $1,000 will have grown into $2,531. Nothing spectacular after all you did wait 10 years to get a bit more than a 1.5X
  • 40 years of investment: your $1,000 investment will grow into close to $42,000. This just goes to show the power of investing and specifically starting early with your investing.


If you have a long-term investment horizon, investing $1,000 into the S&P 500 may be somewhat attractive but for shorter investment horizons you’re not going to make that much.

2- Investing in Highest Yielding Mutual Fund:

One of the best mutual funds in terms of yield over the last 40 years has been the Fidelity® Select Software & IT Services Mutual Fund with an average annual return since inception of around 16%.

  • 10 years of investment: At a 16% average annual return in 10 years, $1,000 grows to around $5,000 
  • 40 years of investment: Our $1,000 will have ballooned into close to $600,000.


This highlights how differences in average annual returns can compound over time. Still, this assumes that you’re able to choose one of the best mutual funds in terms of returns for the next 40 years, and you have that long of a time horizon on your investing.

3- Investing in Yourself:

An investment that is readily achievable for basically anyone with a high rate of success is investing in yourself.

That is, investing in things that will increase your income.

For example, based on a simple Google research, here are the highest paying IT certifications:

1- Google Cloud Certified Professional Cloud Architect (PCA):

Average salary: $176,000

When we look up what a Professional Cloud Architect Certification costs, the registration fee is $200 and the prerequisites are none.

I think it’s reasonable to assume that someone who doesn’t have this certificate who then obtains this certificate can negotiate a $10,000 increase in their salary either with their current employer or by applying for a similar position at a different company and negotiating a salary with that company that is higher than their current salary.

Assuming someone invests $200 in this certification (and the considerable effort to get it) they will have $800 left. If they’re able to increase their salary by $10,000 per year which is around $833 per month and they then invest this money in the S&P 500 (or a halal version of it) they’ll get the following return:

  • 10 years of investment: With the initial investment of $800 and then the $833 extra every month that they’re earning from this certificate, in 10 years their investment is going to grow to $164,042.


This is by far better than the S&P 500 investing results and the mutual fund results. This goes to show the power of increasing your income and having that a priority when you’re investing. Therefore, the first thing you should think about when you’re investing is:

Can I use the money that I have now to increase my income?  

If you have already optimized your income and you’re happy with the level it is at right now then I’d suggest looking seriously into stocks and crypto because as we saw the earlier you start the more powerful your investing becomes.

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