Sunday, April 14, 2024
Sunday, April 14, 2024
Home » 8 Investments That Can Make You Richer Than a Full-Time Job

8 Investments That Can Make You Richer Than a Full-Time Job

by Harley Bennett
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We all want more money, and if we don’t have to work a full-time job to get it, even better! The average national salary across all industries and jobs is $59,428, according to Forbes. Imagine if you could earn more money than that just through investments.

While there aren’t really any true get-rich-quick schemes, financial experts explain how these eight investment strategies can have you rolling in the dough over time, especially if you invest in multiple.

Rental Real Estate

Andrew Lokenauth, financial investor and blogger at Fluent in Finance, recommends investing in properties you can rent out for ongoing income.

“[You] can start small with a single rental unit, then expand over time,” he said. This requires a sizable amount of cash for the down payment, but if your credit is good you can finance the remainder.

Invest In High-Growth Companies

Putting your money into companies that are on the rise can be a great investment. While this kind of investing does take some education and savvy, Lokenauth said that you want to “invest early in companies with exponential growth potential.” He recommends looking to tech, biotech and other innovative industries. This will most likely, however, require a large upfront investment and “risk appetite,” he said.

Launch a Business

“Build a scalable business with the goal of eventual exit,” Lokenauth suggested. This is a high-risk endeavor, but it can promise a high reward if successful. It will also require significant capital investment upfront, but if your business idea is strong enough, it may not be hard to attract investors.

Real Estate Syndications

If you’re ambitious and can make the time, Brian Davis, real estate investor and founder at Spark Rental, recommended real estate syndications. “Real estate syndications typically pay 15%-30% returns, and sometimes much more,” he said. “For example, one syndicator who we’ve invested with a few times in our real estate investment club has delivered average annualized returns of 70.5%.”

Better yet, he pointed out, “These group real estate investments come with all the benefits of owning properties (cash flow, appreciation, tax benefits) and none of the headaches of landlording.”

While returns like that enable you to build wealth quickly and replace your salary, “[they] come with their own downsides as well, from high minimum investments ($25,000-$100,000) to lack of liquidity to the difficulty of finding syndicators,” Davis concluded.

Diversified ETFs

When it comes to investing, diversification is the secret sauce — that is, not putting all your money into any single investment, to mitigate risk. Jake Hill, CEO of the personal finance publication DebtHammer, said, “Diversified investments such as exchange-traded funds (ETFs) have much higher wealth-building potential than almost any full-time job. Since these investments are a passive form of income, you are free to pursue additional income streams while reaping your portfolio’s benefits.”

ETFs are appealing due to their relatively low price compared to several other types of investments, Hill explained. “This makes them accessible at a broader range of initial investment levels. They also generally offer less risk than individual stocks, offering investors more security in the long term.”

Percy Grunwald, a personal finance expert and the co-founder of Compare Banks, added, “The stock market’s historical average annual return of around 7%-9% has outpaced inflation, making ETFs a compelling wealth-building option.”

Dividend-Paying Stocks

Dividend-paying stocks provide both capital appreciation and a stream of income, Grunwald explained. “Over time, reinvesting dividends can significantly boost your wealth. Companies with a history of consistent dividend payments are often considered stable and financially sound.”

Mutual Funds

One way to earn wealth, according to Sherman Standberry, licensed CPA and managing partner at My CPA Coach, is through investing in mutual funds. “Mutual funds pool money from multiple investors to invest in a diversified portfolio of stocks, bonds or other assets,” he said. “They generally offer less potential for rapid growth than individual stocks, but they also typically present less risk. A mutual fund investment can start from a few hundred to a few thousand dollars.”

401(k)s and Savings Accounts

You shouldn’t overlook traditional investment methods, such as 401(k)s and high-yield savings accounts, Standberry said, “which offer safety and a guaranteed return, but the growth is typically slower compared to stocks, real estate or cryptocurrencies. They are excellent options for long-term financial stability.”

While most investing options require getting some financial education, and may work best by attempting a combination of strategies, these are great ways to consider moving beyond just income.

Source : YahooFinance

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