If you’re just diving into the world of investing for the first time, it can be challenging to know where to start. It may seem complicated and daunting. But, fortunately there are many easy ways to get into investing without too much trouble. Even if you’re a seasoned investor, it can be helpful to find new ways to branch out and diversify your investments. Here are five types of investments to consider when diversifying your portfolio.
Bonds
Bonds are a popular choice for investment. They’re a debt security where you are essentially lending money to the bonds issuer, that they will eventually pay back to you with a special rate of interest at a later date. There are a few common types of bonds available today, including:
- Corporate
- High yield
- Municipal
- U.S. treasuries
Bonds can be a great investment. They are not without their risks, so do some research and follow up when dealing with bonds. The last thing you want is to have interest or inflation risk by dealing with bonds. Fraud can also be an inherent risk of dealing with bonds, so it is wise to protect yourself and use financial advisors when going down this route.
Annuities
Annuities can be a worthwhile investment for retirement. According to Experian, annuities are a kind of insurance that pays out during retirement. They can have fixed rates, variable rates, or act like a paycheck. Essentially, you contribute to the annuity and then it pays out to you over time. Annuities also don’t really have contribution limits for the most part, making them a good supplement to an IRA or a 401K. When combined with Social security payments, any savings you might have, other investments, and any retirement accounts annuities can offer a source of financial security throughout your retirement.
Real estate is a popular and somewhat complex investment that can end up being a source of decent revenue. Renting out a property you own, investing in a rental property, or even renting out a room in your current home are all viable options to earn some money through real estate investment. House flipping is another possibility, which can end up being very profitable under the right circumstances. A real estate investment trust (REIT) gives investors the opportunity to get into real estate without owning physical property, while real estate syndication is a method of crowdfunding for an investment property. Many savvy investors deal in real estate as part of their portfolio and it’s definitely with checking out for diversifying yours.
Gold
Many people like to also invest in various precious metals. These may include silver, platinum, and gold. Gold is a popular choice due to its strong inflation to resistant properties and how well it can maintain its value over time. Although gold futures, stocks, mining futures, exchange-traded funds, and certificates are often popular choices for gold investments, physical gold is a good option. Physical gold stays with you or in your own safe storage and can be bought or sold at your convenience. Gold also can be purchased as fine gold (.999 gold) or as pure gold (which is .9999). There are myriad options for purchasing physical gold. These include jewelry, bullion, coins, and gold bars. It’s easy to acquire one or more 5 gram gold bars for a reasonable price. Savvy investors can buy one or more high-quality gold bars that are elegant, secure, and worth the investment in the long run.
Have you given much thought to your retirement? If you’re like most of us, you may not have thought about it much. But rest assured: planning for retirement is an absolute essential. With the cost of living always rising and inflation rearing its head, it’s always wise to plan ahead. Retirement accounts such as an IRA or a 401K are perfect for planning ahead. A 401k is usually offered through an employer and may offer an employer match. 401K accounts cannot be subject to market volatility, however, so you’ll need to make sure that you’re keeping abreast of market trends. Contributing to a 401k is painless and almost passive. It is a wise investment for a certain percentage of your pre-tax pay, especially if you have yet to reach retirement age. An IRA is also a good investment. Although many types of IRA’s exist, Roth IRA’s are quite popular with plenty of savings and tax benefits. Each type of retirement count has age restrictions for when you can take dispersals, but ultimately they will help you build a nest egg for the future.
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