What is the best way to invest 40 thousand dollars?

so that it can grow over time

Standard investment advice is that you should invest in a diversified mix of stocks, bonds, and money market funds. You want to buy a diversified portfolio of stocks as individual stocks are too risky. Most folks have a dificult time buying a properly balanced portfoilio of stocks on their own. They will misbalance their portfolio by buying all small stocks or all growth stocks, or some other misbalanced assortment of stocks. Unless you know what you are doing, it is best to buy mutual funds. I like Vanguard.com, other people like Fidelity, TIAA-CREF, and DFA. Buy no-load, low cost funds. If you are like most people you will invest part of your money aggressively in stock funds, and part conservatively in money market funds and bond funds. Vanguard.com has an on-line questionnaire which will give you an idea of how to do "Asset Allocation," determining how much to put in each type of fund.

If your company offers a 401K plan at work, try to invest the most you can. The money grows tax free, and some companies will match your contribution. Investing in a mutual fund IRA is also a good idea. If you have children, you may want to consider a 529 plan or other college savings plan that grows tax free.

I like index funds. Because of their broad diversification, you are less likely to have a dramatic drop in value. They also have the lowest expenses. For stock funds, I would suggest putting ~70-80% of your money in the Vanguard Total Stock Market Index Fund. and ~20-30% in a foreign stock index fund. However, there are many different opinions out there on what the best mutual funds are. Read the links below and form your own opinion.

If you have high-interest debt, like credit cards, it is best to pay this off first before trying most of the investment ideas above. You should also have 3-6 months of salary saved up as an emergency fund in a bank or money market fund before trying more risky investments.

Believing advice you get on Yahoo answers can be risky, so read these websites for further information. If you find it too confusing, contact a professional financial advisor. They will charge you significant commissions, however.

Sources:

http://www.vanguard.com/VGApp/hnw/planningeducation
http://www.fool.com/school.htm
http://sec.gov/investor/pubs/assetallocation.htm
http://www.diehards.org/readsites.htm
http://finance.yahoo.com/education/begin_investing
http://finance.yahoo.com/funds/basics

Asset Allocation Calculators
(Determining how much to put in stocks and how much into bonds and money markets is a personal decision depending on your financial status. These Asset Allocation questionaires give you a rough idea how to do this. I like Vanguard best, but try some of the other sites as well.)
https://flagship.vanguard.com/VGApp/hnw/FundsInvQuestionnaire?cbdInitTransUrl=https%3A//flagship.vanguard.com/VGApp/hnw/planningeducation/education
https://ais2.tiaa-cref.org/cgi-bin/WebObjects.exe/DTAssetAlcEval
http://www.ifa.com/SurveyNET/index.aspx

Web forum: http://www.diehards.org/
(Many investment web forums are overrun by scam artists. This one seems the most legitimate site.)

529 plans: http://www.savingforcollege.com

Not in anything you catch here in answers. The stock and bond market is not for the timid and is a good way to lose tens of thousands of dollars, could be overnight. There is a company called better trades which will teach you for a price. Scottrade will teach you (their own price), or you can educate yourself, and pay the price. The market is still risky for realestate, but there is money there, they aren't making any more land.

As I have answered before to others, seeking investment advice online is fine if you understand that true investment professionals cannot give you any advice online without violating the "know your customer rule" with the SEC or FINRA(formally NASD). i am an investment professional who is licensed by the FINRA to give advice and receive compensation for that advice. Please believe me when I say that the best sounding advice may not be the best advice for YOU. this is the key...YOU. YOU are who you are, and YOUR situation is what makes advice accurate. If you want advice, please email me, I promise to you that my advice and/or help will be of no charge to you. there is NO catch. I am willing to help you, because I do not want to see anyone get bad advice .

Try to come up with a plan. Investing is a business and as any good business starts with a plan. Write down few factors - your age, income, expenses, time horizon, risk factor etc. Then you will narrow your options to stocks, mutual funds or bonds. Next step is to decide what % you want to put in each investment. Last step is to choose in each category. If you can not do it yourself hire professional ( I'm stockbroker). Please, remember to invest every time you have money to invest, do not count on 40k you have now. Good luck!

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i say stocks ( dont use all of it ) buy low sell high!

buy on index... we are in a recession as is ( ecomoy is going south ) so when the time is right buy an index while it's low and watch it grow, when is gets low again, invest more. like a balloon you don't want to hit the ground
anyways, your 40 thousand will increase over time (as will everything- need proof? the cost of house, living... everything goes up) and the longer you let it mature, the more return you'll see

ALSO don't speed all your $ in one index, spread it out, some indexs will fall.

*an index is a collect of stocks, google it for more intel*

for further info. talk to a stock market guy, ppl have jobs telling ppl how to invest, better yet give to go the mark l. fund, i'll grow over time!
...no? worth a shoot
Happy investing!

There are many things to invest in.
I'm not a financial guru, but I am getting 40%-50% annual interest.
E-mail me and I'll give you advice.
Good luck!

money market , a bit in stocks , an ira or 401k

Depending on your age and where you stand financially there are many options to choose from. You might look at the stock market, perhaps gold (because the price is ever on the rise), and mutual funds. You could choose CDs which pay little over time, but they are generally safe. Speak with a good investor that you can trust and ensure you feel comfortable with decisions you have made. You might also want to open an emergency savings account in case of rainy days which could arise at any time.

ENRON 2! BETTER THAN EVER!

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