As inflation continues to threaten the power of the dollar, many people have begun asking one simple question: where’s the best place to invest money right now? For those with cash on the sidelines, it’s an opportunity to start looking at investment opportunities that might not have piqued your interest previously.

Understanding the best place to invest right now means understanding the market forces at work and the factors affecting different asset classes. It also means taking a forward-looking stance. For instance, the S&P 500 is down year-to-date in 2022, but that doesn’t mean U.S. equities are a bad investment. Likewise, real property is more valuable than ever, but that doesn’t mean now’s a good time to buy.

To better-understand where you should invest your money in 2022, let’s take a look at this question from different perspectives.

Find the best place to invest money right now

First, Pay Down Your Debt

Before you think about sticking money into any particular asset class, take the time to look at your personal debt load. Do you have student loans? A car payment? Credit card debt? Anything outside of a mortgage is debt you should concentrate on paying down first. Why? Because not only is inflation devaluing cash, interest rates are going up. If any of your debts have a variable interest rate attached to them, you’ll end up paying more in the near-term.

Even fixed-interest debt should be your first priority. Bringing down your debt load to include only a mortgage frees up cash you can invest. Best of all, you won’t have inflated payments eating into your personal cash flow. Once you’ve paid down debt, you’ll have more freedom to put your money elsewhere.

U.S. Equities: For Risk Tolerant Investors

Equities might be down in 2022, but they’re trending in the right direction to recover later this year. In fact, several sectors have already crested above the break-even point and begun generating returns for shareholders.

The Energy sector leads the way in 2022, handily outperforming every other sector by a wide margin. Sanctions against Russia up-ended the world’s oil and gas supply, which has paved the way for U.S. hydrocarbon companies to step in. The industry as a whole is up over 40% YTD. Following Energy, the Healthcare sector as a whole is outperforming the market. Insurance and Telecom sectors are also outperforming.

There’s some risk involved with U.S. equities as the Fed positions itself to raise interest rates. That said, macro factors in several industries have already proven enough to surmount these concerns. And, when all’s said and done, equities are historically the best-performing asset class.

U.S. Treasuries: For Income Investors

Where do economists think the best place to invest money right now is? Cash. No, that doesn’t mean sticking money in your mattress or letting your funds sit in a 0.01% interest savings account. It means that U.S. Treasuries will quickly come back in vogue for income investors. Retirees and those with passive income investments could soon see a crop of bonds that pay better than what’s already funding their portfolio.

As the fed seeks to gradually step-up interest rates in 2022 and into the future, U.S. Treasuries will become more appealing. Those looking to capitalize in a forward-looking capacity can start by building a bond ladder or executing a dumbbell strategy as bonds with more favorable rates come out.

While still historically low, the yield from U.S. Treasuries could pick up quickly. For instance, the 3-month T-bill yield rose from 0.09% at the start of 2022 to 0.82% in April: ninefold growth in just a couple of months. Treasuries could become enticing for income investors over the next few years.

Real Property: For Generational Wealth

If property values seem high right now, it’s because they are. Real property was one of the best performing asset classes of 2021 and according to industry experts, it’s slated to continue gaining in 2022. And while it might be difficult to acquire property due to hot markets and rising mortgage rates, real estate remains the best tool for creating generational wealth.

For savvy investors, real property also offers a potential passive revenue stream. Renting out property at a rate that’s enough to pay the mortgage and pocket a profit can be a great double-whammy investment strategy. You’re gaining equity in a home that’s appreciating over time, while also generating revenue you can channel into other investments. Just be mindful of the tax implications and upkeep costs associated with owning investment properties.

Cryptocurrency: For Speculative Investors

If you’ve read an investment newsletter lately, you’re probably aware of the crypto crash that occurred earlier in 2022. Bitcoin and other major crypto coins are down more than 10% YTD after falling roughly 25% in January. This is actually good news for crypto bulls, however: it’s the epitome of buy low, sell high. Crypto is sure to bounce back later in 2022 and is well on its way in the second quarter.

It’s important to remember that while it’s one of the best places to invest money right now, crypto is still a speculative investment. There’s no telling how the market will behave. That said, it has strong bullish sentiment behind it, especially with the prospect of the Metaverse taking form.

Best Place to Invest Money Right Now

Where’s the best place to invest money right now? It depends on your risk tolerance and time horizon. If you’re looking for a reliable, business-as-usual investment, equities are always a good bet. If you’re building generational wealth, few bets are better than real estate. Crypto is even an option for those willing to absorb the risk. Ultimately, the best place to invest your money is in an asset you understand and feel bullish about for the foreseeable future. Don’t forget to pay down debt, first!