If you’ve been unlucky in love, or if you’re just looking for a little more excitement in your life, there are four investments that will never let you down. These are stocks, bonds, real estate and charity.
In addition to being financially rewarding in the long term they also offer some of the most immediate benefits: stock and bond dividends and income from rental properties go straight into your bank account every month; while real estate provides shelter for yourself or loved ones, and charities provide both financial assistance to those who need it as well as opportunities to help others.
Now is a great time to invest because rates on all 4 types of investment have hit historic lows with interest rates still at historical lows so now might be the time to buy. And for those who want to take advantage of buying right now, real estate investment trusts are trading at record lows offering incredible value.
Real estate is a great investment because it provides shelter and protection against inflation. People typically invest in real estate when they need a bigger house or if their current home does not have sufficient rental income. If you think about an asset like a bond it’s fixed and it pays you back an average annual return on your money is around 4% while rental property returns vary but can be as high as 10%. You can click here for more detail on how to achieve this. Additionally, with home ownership levels reaching an all-time low and interest rates at historic lows, now might be the time to buy a house.
Real Estate Investment Trusts (REITs): REITs are companies that own real estate or property for long-term rental income and they often invest in hotels, offices and apartments. They pay out at least 90% of their taxable earnings as dividends to shareholders making them very popular with investors because of their high yield returns. A great benefit of investing in REIT is that you can get diversification with little effort because there are so many different REITs available on the market.
Additionally, these types have been doing well this year since there are few projects being done by developers due to poor economic conditions worldwide. But this means it better to invest now while there’s time to get in on the ground floor. Because of their low cost structure and high returns, these investments continue to be very attractive even in a bad economy.
Investing in stocks offer great rates of return because it allows you to participate in many different growing companies instead of just one single company like with REITs. For example, if Wal-Mart is underperforming your portfolio will not feel the effects. Conversely, when Wal-Mart does well, other companies may suffer since they are not exposed to Wal-Mart stock or bonds. For this reason diversifying through the use of funds like index funds provides extra protection when compared with investing solely in one company via bonds or preferred shares ( also called common stocks).
Another benefit of the stock market is that it keeps up with inflation by having earnings from companies increasing as their expenses rise so your money continues to have value over time. In addition, dividends are typically paid out quarterly and can provide a nice stream of income depending on how many stocks you own. Unfortunately, though the returns have been lower since interest rates have hit new lows making bonds a better investment option.
Bonds are a great way to invest in addition to stocks because they offer a different type of risk/reward ratio from stocks by providing investors with an annual rate of return that is higher than bank or CD yields but less risky than stock dividends. To make matters even better, government agencies like the US Treasury, Federal Agencies, Municipalities, and Corporations issue them so they are very safe because if the borrower defaults your principal is guaranteed by the issuer.
Additionally, because investors have been flocking to these types of investments, interest rates have hit all-time lows making it a good time to invest. Unfortunately though since interest rates have hit new lows it makes real estate look better as an investment option than bonds.
Last but not least, investing in charity is just as important as investing in any other type of investment available today because owning something material isn’t everything. By investing in charity you’re giving up some short-term gains for long-run benefits that could be huge depending on how much money you decide to give away. Investing in education and the environment are always beneficial to you and society.
The 4 investments that people should invest their money in are real estate, stocks, bonds, and charity. All of these types offer different rates of return but it is important to diversify your portfolio so you do not put all your eggs in one basket.