Benefits of Investing
If you are looking for a proven way to invest some initial capital, there are multiple options that may suit you. These methods can grow your money over time, often with a return of 6% or more. Using these proven methods can help minimize the potential downside, reducing the risk of losing money on the opportunity. Although investing can seem difficult, even a small amount of initial capital can grow over time.Real estate
Many people looking for investment opportunities miss one of the biggest sources of growing their capital. Real estate includes homes, buildings, land, and more. Few people realize that the home they already own is a valuable source of future financial gains.If you are unfamiliar with making the most of real estate as an investment and how to finance the purchase of assets, a good place to start is with something called a bank statement loan. These loans are based on your bank statements, which provide insight to the lender regarding your income, expenses, and average account balance. Using this information, a lender will issue a loan to you as an individual or to a corporate entity. Purchasing real estate using a bank loan statement can be easier than a traditional mortgage.
You may not want to purchase a property to hold as it appreciates in value. The most common way to make the most of investing in real estate is to acquire multiple properties and rent them out. From homes to commercial properties, rental income can provide you with a steady stream of cash flow based on your initial investment in the purchase of those properties.
Whether you purchase additional homes, commercial, or industrial properties for rental income, or buy properties and hold them as their value appreciates, utilizing real estate as a vehicle for growing your money can provide an exciting investment prospect.
Stocks, ETFs, and mutual funds
When you purchase stock in a company, you are actually buying a piece of the company. Although trading has become a favored method of using stocks, also called equities, to grow money, investing in equities can provide steady growth with less potential downside. Using careful research, you will evaluate whether a company looks like a good investment. There are a number of ways to evaluate the prospects of a particular stock, and once you find a method that works for you, you can continue to invest and grow your money.Exchange-traded funds, or ETFs, are traded on the open market just like stocks, but instead of a single stock, they are groups of multiple stocks, usually with something in common. For example, you can purchase an ETF of airline stocks or tech companies. Using an ETF as an investment allows you to invest in a market sector and simultaneously spread the risk over multiple stocks instead of relying on whether a single stock appreciates in value.
Mutual funds are another type of common investment. These funds are offered by financial institutions, and provide a return on the initial investment. They are similar to stocks and ETFs in that you buy shares of the fund, but they are generally not bought and sold in the manner of stocks and ETFs. Your bank or investment firm can likely provide you with a list of mutual funds they offer, or you can work with another institution for these investment opportunities.
Bonds
Bonds are an investment instrument whereby the purchaser essentially loans money to the issuer with the expectation that the issuer will repay the value plus accumulated interest at some specific later date. Often, bonds are used by organizations to raise capital for growth or various projects. Rather than owning a part of a company, when you buy a bond, you are acting as a sort of lender.Many people are familiar with savings bonds, those issued by a government. With these, you buy a bond with a certain face value but pay less than the face value. At the maturation of the bond, you can cash it in for the face value, or continue to let its value grow. These bonds are purchased directly from the government and come in a variety of forms, including offerings that aim to outpace inflation.
Other bonds are available to be traded on the open market. These bonds are issued by various organizations, from governments to banks to other corporate entities. These can certainly be purchased directly, but more often the value of these bonds will change over time as interest rates fluctuate. Whoever owns the bond at its maturation will receive the final payout, but previous owners may have an opportunity to make money through buying and selling the bond.
Precious metals
Everyone is familiar with gold and other precious metals, which have had an inherent value for as long as they have been mined. However, many people do not think of gold or silver as an investment opportunity. But if you look back over time at the values of particular precious metals, you can clearly see that they have increased over time. To make the most of investing in precious metals, it is important to find a reputable company offering to sell and buy the metals.Often, investors will have the company hold onto the physical gold or silver, but it is usually an option to store the metal in your own safe or bank. There are also ways to invest in gold or platinum without actually owning the metal. Funds have been set up, similar to ETFs or mutual funds, that payout based on how much of the fund one owns. It is important to consider the pros and cons of different precious metal investment vehicles before deciding which will suit your needs best.