9 Easy Investing Options That Aren't Stocks
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Investing is not only about stocks.
Putting your eggs in different baskets reduces your risk and allows you to explore new ways to invest. And while stocks might be one of the most well-known forms of investing, other options may better suit your investment strategy.
The good news is there are lots of other ways to invest. We looked at 9 alternatives to investing in stocks that are available to everyday investors:
Real Estate Investment Trusts
Overview — A REIT (real estate investment trust) is a business that owns, manages, or funds real estate that generates income. Similar to mutual funds, REITs have a group of investors that share in the profits generated by these assets.
Who is it good for — REITs are suitable for investors who wish to earn dividends from real estate without having to buy or administer any properties. These trusts are also good for investors who want to invest in a particular location or in a specific type of real estate, such as retail, or office, among others.
Getting started — Fundrise allows investors to choose an investment amount they're comfortable with — starting as low as $10. Higher investments come with more customization options. Simply provide your preferences by clicking here and Fundrise will suggest a strategy for you.
Fine Art Investing
Overview — Investing in works of fine art is now something anyone can do, not just the wealthy. By investing in profitable artwork bought through an online platform, your shares can profit from any appreciation and even generate a decent return once the artwork is sold years down the line.
Who is it good for — Lovers of art who have always wanted to invest in famous artworks but lack the capital to do so. Also, buying and selling shares in iconic artwork is a great way to diversify your portfolio.
Getting started — Masterworks is one of the leaders in this space. In a nutshell, they find and buy the artwork with attractive appreciation rates. Once art is purchased you can buy and sell shares directly to and from other investors. To start researching and investing in fine art, join Masterworks' community here.
Fine Wine
Overview — Investing in fine wine is another practice that has long been reserved for the wealthy. Now, with the democratization of the internet, this kind of investment is within reach for anyone who wants to generate decent annual returns.
Who is it good for — Investors looking for a low-volatility market. With a vast network, wine investment platforms may offer you access to new vineyards, private sales, and limited releases to add to your portfolio.
Getting started — Vinovest’s one-minute assessment lets you shape your portfolio based on your preferences. With no minimums, setting up an account is easy. To see Vinovest’s collection of fine wines and fund an account, click here.
Gold And Other Precious Metals
Overview — Precious metals such as gold have been used as investment tools for thousands of years and they could still have a place in your portfolio today.
Gold prices have a tendency to be uncorrelated with stock and bond prices, which means that they don’t always move in the same direction. In fact, during stock market crashes, gold prices often thrive.
Who is it good for — Investors who are looking for a hedge against risk and/or diversify their retirement with an IRA.
Getting started — To learn more about Gold IRAs, Goldco can send you a Free Kit with information about how to grow your retirement and a 3-step process to invest in precious metals. Simply click here and submit your information.
Series I Savings Bonds
Overview — The Series I Savings Bond, also known as the I Bond, is provided by the federal government and currently has an interest rate of 6.89% for savings bonds issued by April 31, 2023. I bonds are U.S. savings bonds that are issued by the Treasury Department with the express purpose of preventing inflation from eroding your money's purchasing value. Investors can buy them for as low as $25.
For digital bonds, the cap is set at $10,000. For paper bonds, you can buy up to $5,000.
Who is it good for — Investors with a max of $10,000 to invest and are looking for a low-risk investment that is 100% backed by the federal government. I Bonds are particularly well-suited for investors playing the long game due to the fact that they earn interest for up to 30 years.
Getting started — The simplest way to get digital I Bonds is through the Treasury Department website. To learn more, click here.
Cryptocurrency
Overview — Cryptocurrencies are digital assets or virtual currencies. While there are plenty of different coins, the most well-known is Bitcoin. Traders can buy, sell, and/or trade different types of cryptocurrencies through the use of crypto exchanges.
Who is it good for — If you’re passionate about fintech and have a high-risk tolerance, trading cryptocurrency could be a good option.
Getting started — Public is a platform that allows users to buy and sell stocks, crypto, and other alternative assets. Their simplified process makes buying and selling cryptocurrencies similar to buying stocks. Create your account with Public today by clicking here.
High-Yield Savings Accounts
Overview — A high-yield savings account can boast better interest rates than a standard savings account — sometimes up to 20 times higher. Investing in a high-yield savings account may pose little to no risk. Additionally, this kind of account provides ample convenience while your money remains backed by the FDIC with the safety of federal insurance for up to $250,000.
Who is it good for — Consumers who are looking to hold cash and have it earn returns. These accounts are also good for consumers who are not looking to take on a lot of risk while keeping their money readily available for transfer.
Getting started — Barclay’s offers a competitive APY on its high-yield savings account. Click here to check rates and open a high-yield savings account with Barclay’s.
Farmland
Overview — Investing in farmland has a long history of producing decent returns. Not to mention the fact that there are millions of acres of land across the U.S. devoted to farming. But keep in mind that farmland is at the mercy of weather conditions, and these can sometimes affect your bottom line.
Who is it good for — This niche within real estate investing has demonstrated historically strong returns and could be a good fit for someone looking to hedge against inflation. Farmland could provide a good way to diversify your real estate investment strategy.
Getting started — Similar to REITs, farmland investing can be carried out with ease online. AcreTrader is a good place to start. Click here to see offerings and create an account.
Peer-To-Peer Lending
Overview — Investing in loans through a peer-to-peer lending service allows you to earn returns off the borrower’s interest payments. One downside is the risk that the borrower may default on their loan — no collateral is required to take out a loan. That said, if you keep your investments spread out among different portions of loans, it may reduce your risk.
Who is it good for — Peer-to-peer lending may be suitable for investors who are looking to invest small amounts.
Getting started — Prosper is a peer-to-peer lending marketplace. The company has its own rating system, which takes into account factors like debt-to-income ratio and credit history. This system is then used by Prosper to qualify candidates. With the score given to each potential borrower, investors can choose whether or not to fund the loan.
To get started, simply click here.
Bottom line
Investing can be a tricky thing for some, and that’s okay.
You want to make sure that you are diversifying your portfolio and not just sticking to one type of investment. There are plenty of other investments out there besides stocks that can help you grow your money.
Ultimately, investing doesn't have to be complicated. The list above is a great example of varying degrees of both risk and return. It's just a matter of finding the right investment for you.