I’m turning 25 soon, and now that I’m reaching the halfway point in my twenties, I’m definitely thinking about how I want the next five to ten years of my life to look like.
Part of what I’m thinking about is how to grow wealth and also what I want my work-life balance to look like in the coming years.
I think these sorts of questions are common for us twenty-something-year-olds, but it’s good to ask these questions.
So, if you’re wondering how to potentially get ahead and what sort of assets to buy in your 20s, this is the post for you!
I’m going to cover some of the strategies I’m thinking about to develop passive income, make more money, and ultimately improve your finances.
The Best Assets To Buy In Your 20s
Your twenties is an exciting time since this is when many people finish school, land their first job, and even move out on their own.
I also think your twenties is the perfect time to grind, experiment with different side hustles, and to start creating multiple income streams.
So, on that note, let’s jump into some assets to buy in your twenties that can help you diversify and increase your income!
1. ETFs
One of the most obvious assets you can buy in your 20s are exchange traded funds, or ETFs.
An ETF is basically a basket of securities you can buy, just like stocks.
And, the nice part about ETFs is that you get some automatic diversification since you’re buying a basket of securities and not just picking individual stocks.
There are plenty of different ETFs, and some popular categories include:
- Dividend ETFs: ETFs composed mostly of dividend-paying stocks and assets.
- Crypto ETFs: These are a more recent addition but you can now buy several ETFs that focus entirely on crypto and blockchain companies.
- Index ETFs: These basically copy certain indexes, like the S&P 500, so you can buy the top companies in a certain index in a single ETF.
- Fixed-Income ETFs: Most of these ETFs use bonds and other fixed-income securities to generate predictable returns over a certain timeframe.
I’ve been investing in ETFs since my time in college, and again, my favorite part is that you get a lot more diversification and don’t have to necessarily worry about researching stocks independently.
Plus, you can buy ETFs quite easily if you open an investing account with your bank or use a commission-free trading platform like M1 Finance or SoFi.
Ultimately, I think this is one of the best assets to buy in your 20s since it sets a nice foundation for building wealth and also gets you in the habit of investing.
2. Real Estate Equity
Real estate seems prohibitively expensive, and in many areas of the world, this is unfortunately true.
I mean, I spend much of the year living in the Greater Toronto Area, so I don’t have plans on buying a house anytime soon!
However, real estate is still an asset to buy in your 20s if you want to benefit from real estate income and appreciation without needing to have a small fortune to spend.
Thanks to real estate crowdfunding companies, you can actually start investing in real estate by pooling your money together with other investors.
One of the most popular companies in this space is Fundrise, which lets you invest in income-generating real estate properties with only $10.
Fundrise has numerous portolios you can choose from, is relatively low fee, and pays investors with quarterly dividends.
The fact you only need $10 to start is also very beginner friendly, so you can try out Fundrise even if you’re in your twenties but are still finding your financial footing.
Similarly, you can also try companies like Groundfloor that let you invest in shorter-term real estate debt with just $10.
Groundfloor pays you monthly interest on real estate loans you help fund, and between Fundrise and Groundfloor, you can achieve a nice mix of real estate equity and debt in your portfolio.
Get started with Fundrise or Groundfloor today!
3. An Online Business
When I was in my twenties, I started This Online World as one of my first college side hustles.
And, what started out as a small blog that helped pay for groceries has turned into a much more serious income-generating asset after three years of work.
For context, here’s how my blogging income has grown over the years:
- Year One: ~$1,700 in income.
- Year Two: ~$7,000 in income.
- Year Three: ~$22,000 in income.
In my opinion, this story highlights why starting or buying an online business is one of the best assets to buy in your 20s.
The main benefit of online businesses is that the income ceiling is incredibly high, and you can usually scale the income the harder you work.
Again, running a blog is a perfect example; as you grow your traffic and monetization avenues, you can steadily make more money with your blog every year.
Plus, I think this is a great asset for twenty year olds since an online business teaches you so many skills.
Because of my blog, I’ve learned a wealth of information about SEO, content writing, web design, and social media marketing.
My blog also let me get into freelance writing and land various consulting gigs, which are two of my main income streams.
The point is, an online business is one of the best assets for 20 year olds since it has life-changing potential from an income and career perspective.
Plus, you have so many options to choose from, not just blogging.
Some online business ideas you can consider include:
- A print-on-demand Etsy business
- A general ecommerce store
- A YouTube channel
- Using sites like Redbubble to sell your designs
- A Substack newsletter (I consider this an online business!)
- An agency that provides a specific service to business owners
I started making money on YouTube after starting my blog, and again, this is a perfect example of how a small asset can turn into a significant income stream in a short amount of time.
4. Dividend Paying Stocks
Another asset to buy in your twenties are dividend stocks.
Now, a lot of people shy away from dividend stocks if they’re younger.
This is because younger investors have a longer investment timeframe, can stomach a bit more risk, and can therefore prioritize investing in growth stocks that potentially have more long-term potential.
However, I still think dividend stocks are a great asset to buy in your 20s since it’s just another straightforward way to develop more passive income streams for yourself.
For example, alongside growth-focused ETFs, I invest in some dividend-paying ETFs and stocks.
Because of these holdings, I earn around $1,000+ per year in dividend income, which is basically free money as far as I’m concerned!
Again, I’m not a financial planner, and I recommend doing your own reading, deciding on your level of risk tolerance, and seeking professional financial advice if you’re considering how to invest.
However, dividend stocks are an asset I’m going to buy in my 20s, and I definitely think it’s a nice way to create a small new income stream for yourself.
5. Something To Start A Hobby
I think it’s easy to get consumed by work, life, and your studies as you enter your twenties.
However, I think it’s also critical to keep up with hobbies since our hobbies are often what open new doors and opportunities, even though we don’t always realize this.
Additionally, your hobbies are often monetizable as well, so purchasing equipment or stuff for your hobby isn’t necessarily throwing money into the wind.
For example, if you buy a camera, you can start a YouTube channel down the line or start a photography side hustle.
Want to learn an instrument? Hey, that’s a potential music lesson business or busking opportunity if you’re so inclined.
These are just a few examples, but there are so many ways to turn a hobby into some sort of income source or even a career.
Again, I started a blog largely because I like writing, and it ended up turning into my career, so you never know what can happen!
6. Cryptocurrency
If you’re still wondering what to buy in your 20s, you can always consider diversifying your portfolio with cryptocurrency.
This is something I’ve started doing this year, and I’ve predominantly focused on Bitcoin, Ethereum, and Cardano (the ADA is more recent.)
The way I see it, like growth stocks, younger people can take on a bit more risk tolerance and play for the long-term with their investments.
They can also try out some more speculative investments, which you might argue encapsulates cryptocurrency.
In any case, it’s very easy to buy crypto, and you can even leverage your holdings to earn passive income through interest which is something I’ve been exploring more recently.
For example, you can buy popular cryptocurrencies on exchanges like Coinbase, and you just need $2 to start buying crypto.
From there, you can deposit your crypto on platforms like Nexo.io or BlockFi and earn interest on your crypto!
That’s right, platforms like Nexo let you turn your crypto into an income-generating asset, which is pretty cool if you ask me!
I’m going to test out earning interest with Cardano by using Nexo in the coming months, and this is definitely a fascinating asset class that’s also worth exploring if you’re in your twenties.
7. Something To Earn Passive Income
Stocks, ETFs, real estate, and even cryptocurrencies are all tools you can use to develop passive income.
But, if you’re looking for other assets to buy in your 20s, you can always branch into more creative ways to generate some extra monthly cash.
After all, there are plenty of things you can rent out for money, including:
- Equipment and tools on rental marketplaces like Fat Llama
- Instruments on websites like Fretish
- Extra storage space on platforms like Neighbor Storage
- Clothing on Rent My Wardrobe
- A vehicle with platforms like Turo, HyreCar, or RVShare
This is just scratching the surface, but I think there’s a ton of potential here even if you’re in your twenties and don’t have much disposable income.
For example, people can make hundreds or thousands of dollars renting out stuff like DJ equipment, drones, and cameras on Fat Llama if they live in a decently populated city.
Similarly, with Neighbor Storage, you can turn a backyard shed into a storage space that earns you monthly income!
You have to get creative with this idea, but hey, I think it’s another cool way to create different income streams.
8. Education
While this isn’t the most classic example of assets to buy in your 20s, I think investing in your education is often one of the best decisions you can make.
And I’m not necessarily talking about going to college or university since I don’t always think this is the best path for people depending on their goals and interests.
What I am talking about is using the power of the internet to learn new skills that help you boost your income or land a better, more engaging job you love.
There are so many examples here, and you don’t need to spend a fortune either.
For example, on Udemy, you can find courses for $20 to $100 that cover a variety of topics like:
- Blogging
- Blockchain and crypto stuff
- Coding
- Copywriting
- Data science
- Design
- Marketing
- Mobile app development
- SEO
- SQL
- Web development
- YouTube
- Voice over work
The fact that you can also learn very niche, industry-specific skills like becoming AWS certified or learning Google Flutter is also an example of how Udemy can help prepare you for the job market.
And Udemy is just one source of info; you can find a wealth of free information on Google and YouTube anyway, so you might not have to spend a penny!
Extra Reading – 20+ Jobs That Pay $5,000 Per Month Or More!
Other Tips For Buying Assets In Your 20s
Now that you know some of the best investments to make in your 20s, I want to cover a few more tips you can use as well.
1. Build An Emergency Fund
Buying assets in your 20s that generate income is a great way to begin building wealth.
However, it’s still important to have a cushion of cash in an emergency fund to cover sudden, unexpected expenses like your car breaking down or your fridge breaking.
An emergency fund helps you pay for unexpected events in life without having to dip into credit or personal loans.
Some financial experts suggest having enough money in your emergency fund to cover six months of living expenses, but you can decide how much of a cushion you need to feel comfortable.
2. Play Financial Defence & Save Money
Creating multiple income streams is great, but this is of little use if you spend everything you earn.
Another important tip for twenty year olds is to build a budget and to save more money.
Personally, I use an Excel spreadsheet and my mobile banking app to track my monthly spending and savings rate.
However, you can also use free budgeting apps like Mint or AI-powered financial assistants like the Cleo app.
Whatever route you choose, just remember to stick with it and to set actual savings goals so you have something to work towards!
3. Don’t Stretch Yourself Too Thinly
There are lots of assets you can buy in your 20s, but it’s important to focus on one thing at a time until something is up and running.
Making money online with a blog is the perfect example; it can take months or years for your blog to get up and running, so it’s important to put in the time to actually nurture this asset.
I know a lot of people in their twenties who have several businesses and say they’re entrepreneurs, but none of the businesses actually do any business.
Get multiple irons in the fire, but make sure an iron is actually hot before moving onto another one.
Frequently Asked Questions
1. What Assets Should You Have In Your 20s
A major financial goal for your twenties is to become debt free and to increase your income.
So, this means paying off debt like student loans or consumer debt is important. It’s also important to job hop or find a job that pays well, improves your skills, and has room for career growth.
As for assets you should have in your 20s, that’s a tricky one to answer.
Many housing markets are prohibitively expensive, so property isn’t always realistic.
But, at the very least, I think people in their twenties should focus on becoming debt free and learning how to invest.
2. How Can I Build Wealth In My 20s?
In my opinion, people can start building wealth in their 20s by:
- Living frugally
- Tracking their spending
- Investing money every month
- Starting side hustles
- Looking for career growth opportunities
In short, if you save much more than you spend, invest, and look for ways to increase your income, you can start building wealth in your 20s.
Final Thoughts
I hope this list of assets to buy in your 20s helps you find ways to diversify your income for an exciting period of your life.
Personally, I’m going to keep learning more about investing and starting various side hustles and online businesses to try and build wealth.
But, the world is truly your oyster, and there are so many options out there, even if you’re in your twenties and don’t have much starting capital.
Thanks for reading!
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Tom is a 24 year old recent college graduate from Canada with a passion for side hustling, passive income, and marketing. This Online World is all about providing people with honest ways to make and save more money by using technology. To learn more about Tom, read his About Page!
If you’re interested in freelance writing services or want to partner with This Online World, please visit Tom Blake Digital to get in touch!