This post may contain affiliate links, allowing us to earn a commission on the products we would recommend to our families and closest friends. You can find more info on our Legal Stuff page.
Investing in the conventional stock market is a good long-term strategy for building wealth. But if you want to make a difference in your finances quickly, that’s not the way to do it. Stocks let you build wealth over decades, but you can’t suddenly generate a second income with them. That’s not how it works.
Fortunately, there are other methods you can try. These sometimes involve taking more risks, but they give it all back to you in the form of higher rewards. So, where should you be putting your money? Let’s take a look.
Self-Investment
It might sound corny, but investing in yourself is one of the principal ways to get ahead. Putting effort into your education and skills development can help you further your career and increase your earnings potential massively.
Buying Pre-IPO Firms
Another way to get ahead of the crowd is to find a promising business for sale that’s not yet at the IPO stage. Companies are often considerably cheaper before they go public because fewer people know about them or their potential. Doing your research can help you nab one of these firms and make better returns.
With that said, pre-IPO companies are risky, so you’ll want to do your research first. It must have a viable product, good management, and prospects to expand substantially.
Art
You might also dabble with art investments, particularly if you have an interest in the area. You may have a sense of which pieces will rise in value going into the future, and which might not be as popular.
Crowdfunding
Another area to explore is crowdfunding. This approach to investing involves sending money to a crowdfunding platform and then allowing businesses to use it to invest in their projects.
The amount of control you get over this process varies from one platform to the next. Some offer an exceptional level of management, while others take over administration responsibility and promise you a fixed return from their lending activities, taking a cut for themselves.
Infrastructure Investment Trusts
Infrastructure investment trusts are another area you might want to consider. These operate similarly to real estate investment trusts and are essential for building roads, bridges, and so on.
These investments can offer returns because they give you exposure to a sector that most people don’t put money into. These larger projects are harder to access and are usually reserved for institutional investors, but you could put money into them if you wanted to diversify a little more.
Peer-to-Peer Lending
If the idea of crowdfunding doesn’t appeal to you, then you might want to make money by lending peer-to-peer. The rates you get will be significantly higher than simply putting your money in the bank.
Of course, the risks are higher, too. But you can actually spread your lending over multiple people, giving you an expected return that’s more or less reliable. Once you have around 30 people in your portfolio, you can pretty much guess what your returns for the year are going to be using the laws of statistical averages.
Comments (0)