All of us wants an opportunity to save and become financially stable. Well, you will need to do more than making money. Above all, you need to hold onto your earned money carefully and wisely. Then, you need to grow them. To be able to grow your money, you have to learn how to invest.
Investing is the act of contributing money to various endeavors with the hope of acquiring additional profit or income. Of course, anyone can invest, but those people who are wholeheartedly and willing to take this kind of venture will only succeed.
Know that all investments have specific risks. Thus you should never put all your money in one venture. For a little help, listed below are five ways to invest your money and potentially get good returns.
Peer to peer or P2P lending is a means of debt financing that allows every person to loan and lend cash without using any financial institution as a mediator. It eliminates the intermediary from the process. However, it involves more risk, time, and effort than any other lending scenarios.
With Peer-to-peer lending, borrowers pay lower interest rates compared to banks. While P2P investors gain earnings that are much higher than what they can earn at the banks. However, P2P lending is not entirely risk-free.
Just like any investment, you need to stay mindful. Furthermore, in P2P lending, you do not invest in full loans. Instead, you invest in small portions of these loans. As such, you can buy them for as low as $25.
And if you are searching for investment with a high return, certain yields, and low risk, you should consider investing in peer-to-peer lending. However, to help you more, you can seek advice from legal firms such as Ashe Morgan.
Fixed Annuities are annuity contracts between the investor and the insurance company. The annuity contract requires the insurance company to make a set of certain annuity subsidy to the investor throughout the term of the contract.
This type of investment is ideal for those who look for higher earnings with the security of principal. With fixed annuities, investors can invest a virtually vast amount of money and allow it to grow without any tax up until you reach your retirement age.
For sure, there have been situations wherein investors lose their money because the companies went broke. But the probability of this case to happen today is significantly low, most especially if the annuity contract came from fixed annuity carriers.
Overall, fixed annuities offer low but safe returns. Your beneficiaries will get all the money of the annuity contract. With that said, if you invest in fixed annuities, you secure the future of you and your family.
Money Market Funds
Money market funds are a collection of short-term bonds, certificate of deposits, and other investments that offer low-risk investment. These funds were gathered to build a diversification without having too much risk. Mutual fund companies and brokerage firms are usually the ones who sell this kind of investment scheme.
However, unlike certificate of deposits, money market fund is readily available. Meaning, you can easily take your funds (anytime) without giving you extra charges. And according to Ben Wacek, a financial planner and founder of Wacek Financial Planning in Minneapolis, money market funds are reasonably safe.
Real estate investment trusts or REITs are like mutual funds that invest money in real estate. Commonly, you can invest in a commercial real estate like apartment complexes, office buildings, and shopping centers.
With REIT, you can invest in dozens of properties. Thus, providing diversity that includes different locations and various types of properties. Know that it can be very important since the real estate market might be robust in a certain state or city.
Different from the usual real estate investing, real estate investment trusts implement a stable measure of liquidity whatever your investment option is. Therefore, you can easily market any of your investment properties when you think that it is appropriate.
Real estate investment trusts are low risk-investments and can generate excellent returns, which makes them a great source of passive income. If you are not into being a landlord, consider other options that do not deal with physical properties, just like REITs.
Brokered Certificate of Deposit
Brokered CDs is a certificate of deposit purchased from a sales representative or a brokerage firm other than a bank. Brokered CDs are ideal for people who cannot manage to lose any of their invested money.
Even though Brokered CDs don’t pay high rates like utility or preferred stocks, they can significantly pay more than their other competitors. Furthermore, you can market brokered CDs just like any other fixed investments.
But before you even delve into this investment, make sure that you know the risks and rewards of purchasing and holding this type of certificate of deposit. Study all any fees that you might pay in the future.
Investing is for everyone. For people who want to have a steady source of income and for people who are more than willing to delve into a financial venture. And of course, when it comes to investing there is always risks.
Different low-risk investments generate good returns such as Money Market Funds and Fixed Annuities. But make sure that you make effective and efficient decisions when it comes to investments because it can make a great difference over time.