Buying Apple (AAPL) stock has been one of the greatest investments of all time. Even billionaire Warren Buffett, one of the most successful investors of all time, has made Apple the biggest single position in the investment portfolio of his company, Berkshire Hathaway.
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However, hindsight doesn’t matter if you’re considering buying Apple stock for the first time. Before taking a bite out of this particular apple, consider the following current market summary stats (as of May 2, 2025):
Apple could be seeing some shake-ups in its profit margins as shares have slipped this year due to President Trump’s tariff turmoil. This should give investors momentary pause while the tech giant figures out a way to offset high importation taxes on some of its biggest sellers, like iPhones and more.
So, is buying Apple a good move now, or are there smarter things to do with your money? Here are three potentially much better options for you to consider.
As impressive as Apple’s return has been over the years, paying off any high-interest debt you may have can be a much better choice for your money. Most credit cards now charge 20%, 25% or even more in interest annually. If you use your money to pay that debt down, you’re effectively getting a guaranteed return of 20% or more annually.
While Apple is certainly capable of posting a 20%-plus return in any given year, it may also lose that amount or more. Snagging the guaranteed return of paying down your debt can be a much wiser move over the long run.
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The cornerstone of any financial plan is a solid emergency fund. Although most Americans know they should have one, many still don’t.
If you have an emergency fund, you’ll have cash on hand to deal with life’s little unexpected problems. If you don’t, you’ll risk going into debt if your car needs repairs or you bust a water main at your house.
And as soon as you’re in debt, your financial problems can rapidly spin out of control. A $2,000 credit card bill could double to over $4,000 in four years or less if you put it on a credit card.
As strong a performer as Apple has been, dumping all of your investable money into it isn’t a very prudent financial strategy. Most financial experts, including Fidelity, recommend that investors diversify their holdings across various asset classes and types. This can help minimize your risk while maintaining your potential reward.
If you put all your money into one stock, even as blue chip a stock as Apple, you risk losing your entire bankroll. Granted, it’s unlikely that Apple will actually go bankrupt anytime soon, but it’s entirely possible that its shares could trade down 20%, 30% or even more.
If your entire portfolio is in just one stock, your whole financial life is a big bet on a single company. That’s not very prudent risk management.
Let’s say you’ve decided to invest your money in a single stock, even though diversifying your portfolio is a safer option. In spite of its long-term track record, Apple may not be the single stock you should choose. Primarily due to its price-to-earnings (P/E) ratio, many analysts feel the stock is currently overvalued.
Though Apple stock is still generally considered a buy by most experts, they would also tell you to maybe sit out this investment round until things with tariff volatility and consumer skittishness calm down. So, keep your eye on it, as Apple will probably become worth buying again when this situation dissipates a bit or AI boosts its value exponentially.
Most anyone who has invested in Apple for any significant amount of time has made good money, and the company certainly has a lot going for it still, from a rabid fan base to its immense pile of cash. But this doesn’t mean that it’s necessarily a great place for your money right now, especially if you have high-interest debt and no emergency fund.
Most experts agree that you should build a solid financial foundation, diversify your portfolio and evaluate the risk-reward characteristics of Apple at these lofty levels before investing your money.
Caitlyn Moorhead contributed to the reporting for this article.
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This article originally appeared on GOBankingRates.com: 3 Smarter Things To Do With Your Money Than Buy Apple Stock
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