Heads up: This article was commissioned as a part of the Adam Rush Project. It was an experiment I did a few years ago to see if having books written by ghostwriters would be commercially viable. It wasn't. That said, the following article was written by someone else and not yet edited to my standards. I hope to find time to rewrite it myself in the future, but for now, read with caution.
Disclaimer: In this article, I discuss financial topics. These are my personal thoughts and opinions. I am not a financial advisor, and none of what you read here is financial advice.
Investing money not only brings in profit but also makes sure all your income doesn’t go into expenses. Investments allow you to keep a part of your money away from your daily expenses and brings in passive income. It is important to find the right investment option. You have to choose the right option depending on your income level, frequency of income, assets you own, and credit score. Here are the top 30 investment options available for you to choose from.
1. Mutual funds
Mutual funds are run by asset management companies and it is an investment scheme in which people come together to invest in a portfolio of bonds, stocks, or any other form of securities. There are various types of mutual funds. It is a good start for people who are new to investments as the entire process is managed by professionals.
2. Equity funds
An equity fund is a type of mutual fund that deals with investment only in stocks and not any other form of security. Market capitalization determines the size of equity funds and some of these funds may target various business sectors like real estate and healthcare. Equity funds can be both domestic or international and bring great returns in both short- or long-term plans.
3. Buy stocks
Buying stocks of profitable companies allows you to share part of their profits. You can start by buying a few stocks and using profits to buy more. Or you can sell the stocks for a profit when the market reaches highs. Whenever you plan to buy stocks of a specific company, make sure you do an analysis of how the company is faring in the market. You don’t want to buy stocks of a company that’s going towards bankruptcy.
4. Cryptocurrencies
Cryptocurrency is the latest investment trend. There are various cryptocurrencies available such as, Bitcoin, Ethereum, XRP, Bitcoin Cash, and hundreds of others. All you need to do to invest is buy them on an exchange like Coinbase. When you are ready to sell them, there are countless buyers who are ready to buy cryptocurrencies at market value on the exchanges. The market values of cryptocurrencies are volatile and speculative, so never invest more than you can bear to lose.
5. Bank CD
A bank certificate of deposit (CD) is one of the easiest investment ideas. All you have to do is deposit a certain amount of money in the bank as a CD. After a certain period of time of your choice, you can take the money back out along with a percentage interest. This is a sure shot way to grow your money without taking any risks.
6. Precious metals
Precious metals like gold and platinum can be good investments. They are physical items that cannot be destroyed, so they will always retain value. Buying solid gold coins or bars is a better idea than buying jewelry. The resale worth of jewelry is always less than the price you buy them for. Solid gold or platinum bars always fetch the current market price. You can purchase them from banks directly and even sell them back whenever you feel the price has hit a peak.
7. Cash value life insurance
Cash value life insurance not only benefits your family after your death but allows you to reap benefits just like any other investment. It allows you to borrow the accrued sum of money through your lifetime and the accrued value is spared from income taxes.
8. Your home
Invest in buying your own home! It saves on staying in rented apartments and you can also lease your home out for rent and earn money. You can even resell your home whenever you want. It is one of the safest investment options that buys you a roof over your head.
9. Land
Buying a plot of land is not a bad idea either. Builders are always looking for land for construction. It is also a limited resource that will only increase in value as the population of the world increases. You can buy income-producing land like a farm that can bring in additional revenue. It’s like an empty slate that allows you to draw your choice of return.
10. Money lending
Become a money lender—let people borrow money from you and repay you with a certain interest rate. You can sign up at any peer-to-peer money lending site and enjoy the interest rates with some effortless investment. Lending money through established money lending organizations carries low risk if you are careful about who you lend to.
11. IRA
Individual Retirement Account is a retirement scheme that gives you tax benefits. You not only save on tax but the withdrawals made from the IRA are all tax-free. There are different kinds of IRAs that come with different benefits and limitations. But all of them offer tax benefits and
secures your old age as well which makes this a go-to investment scheme for any salaried individual.
12. High interest savings account
If you have a consistent income, sign up for a high interest savings account and enjoy high interest on your bank balance. It is a good idea if you can maintain a good bank balance and leave it untouched. If you’re struggling financially, you cannot reap benefits of such bank accounts. Rather you will end up paying for non-maintenance of minimum balance.
13. Credit card rewards
There are many credit cards offering reward points that you get to encash. You can even use them to clear your credit card bills. Such credit cards come at a minimal fee or sometimes free of cost and a great way to get some returns effortlessly. You can encash the points and transfer them to your savings account as well and earn interest out of the money.
14. Annuities
Annuities are complex forms of investment but one of the safest investment options with sure returns. You have to trade a certain sum of money with some insurance company and they promise you a certain rate of interest in return. Sometimes the return can be variable which makes the investment slightly risky.
15. Treasury inflation protected securities
The US Treasury offers multiple bond investment schemes for you to choose from. The one with least risk is called TIPS ( Treasury Inflation Protection Securities). This bond scheme comes in two variants. One variant offers a fixed rate of return that doesn’t change during the entire period of bond. The other variant comes with a flexible rate of growth defined by the rate of inflation. It comes under a protection plan that’s guaranteed by the US government.
16. Municipal bonds
When government bonds need a certain amount of money for any project, they do not take bank credit. They issue municipal bonds. Investment in these bonds fetch income tax exemptions and also promise a good rate of interest. This is a safe investment option as it is monitored by the government and better than any risky private investment scheme.
17. US Savings bond
Issued by the United States Federal Government, it comes in two types: Series I and Series EE. Series I has two benefits: a fixed rate of interest and an inflation-defined return. Every six months the inflation rate is revised by the government. Series EE just has a fixed rate of interest benefit and it gets added to the bond every month.
18. Online checking account
Online checking accounts do not charge any money to kick start your savings and investment plan and offer small interests on the amount of money you deposit in them. You can withdraw the money as well for your expenses while enjoying the interests along with it. The interests may be small but good for people who do not have enough funds for big investments and want to start it small.
19. Bank bonus
During sign up, some banks offer bonuses worth several hundred and in return ask you to deposit a certain sum of money for a certain period of time. The money deposited stays safe for that entire period of time and you earn the bonus. It is a risk free way of investing while earning some good money.
20. Preferred stock
Preferred stock allows you to invest in a company’s shares and get dividend payments in return. It has both equity and debt portions and has less risk than the common stock investments. If you want to invest in stocks at minimum risk, this is one way to go about it.
21. Pay off high interest debt
Paying off a high interest debt is an indirect investment you’re making. You save yourself from the whopping interest rate and save the value for yourself. If you have a sum of money in your hand and have a pending credit card bill, instead of waiting for the monthly bill generation every month, clear it off all together. It will save more money than investing that sum of money in a bank CD or mutual funds.
22. 401K
If you are a salaried individual, you can opt for the employer-sponsored 401k plan that fetches tax benefits. If you withdraw money from your 401k account, you will have to pay less tax per withdrawal. They are not tax-free like IRAs but helps in saving tax and is sponsored by your employer which makes it good investment plan.
23. 529 plans
If you’re planning college education and also planning savings around it, the government offers tax exemptions. Certain state governments allow the residents to deduct their tax contributions from the state income tax funds. 529 plans sometimes come with target-dates based on the child’s birth year to calculate when he/she will be eligible for college.
24. Index funds and ETF
Index funds and ETFs are passively managed mutual funds. If you want to make a long-term investment for some bigger goals, you can open an investment account through brokerage. Both ETF and index funds charge less fees and offer better value. Index funds offer returns as per market value while ETF returns are more variable, making it a riskier option.
25. Partner in small business
Invest in a small business along with a partner and watch your business grow. A small business will require small investment and in long run it can grow into a bigger business. There is risk of loss but if you want an investment that gives you the chance to be independent and allows you to be your own boss then this is it. Partnering with a friend or colleague, reduces the amount of money you have to invest in.
26. Money market funds
If you want to invest in mutual funds and don’t want to lose any of the investment you made, money market funds is the right place for you to invest. The fund tries to maintain a NAV worth $1 per share and there is an effort to pay out some interest for the amount that you deposit as investment. Even if the interest rate if low, it brings along lower risks of losing chunks of your principal amount.
27. Collectibles
Antiques and collectibles like coins and stamps are creative investments. They fetch a lot of money in the market. A signed copy of Maroon5 CD may bring you thousands of dollars after ten years! Buying autographed books or special edition of music CDs or cult movies are unique investment ideas.
28. Gemstones
Gemstones are a risky investment option but if you are affluent and own unique pieces of diamonds or other precious stones, you are mostly like to become richer. You can participate in auctions and get double or even triple the original value of the gemstones if lucky. Ordinary gemstones, however, may or may not fetch good value. Depends on the market situation and buyers. You need to find the right people to sell them.
29. Options trading
Options trading is a kind of short term or daily trading in which you look for small ups and downs in share prices and try to make small profits out of them. It is not a long term investment plan but does bring good returns if you trade wisely.
30. Angel investor
If you are rich and have surplus money, the best way to earn good revenue is by becoming angel investor. Look for promising startups in startup events or online and invest in them and help them grow. Startups fetch good revenue if their business idea is great. If you identify the right talent and invest wisely, you get to be a stakeholder in the company and enjoy a certain percentage of the profits or stocks worth a certain value. It depends on your terms of negotiation.
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