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8 Best Investments To Make This Summer To Build Wealth

The arrival of warmer weather is an excellent time to add some solid summer investments to your investment portfolio. Suppose you have a week off during which half of your team is away. It might be worthwhile to sit down and conduct some research on stocks you’re considering purchasing or to get serious about developing a timeline for when you’d like to buy real estate.

Today’s investors have a plethora of investment options to choose from, and they can select the level of risk they are willing to accept to achieve their financial goals. If you’re looking to boost your wealth this summer, the following suggestions may help:

1. Fractional Real Estate

A fractional real estate investing is a commercial real estate investment in which individuals acquire a portion of a property rather than the entire asset. The advantage of this strategy is that it enables investors to obtain deals of institutional quality that they would not have been able to get otherwise. Additionally, by increasing the investment size, fractional investments can generate passive income and help diversify an investor’s portfolio.

The sponsor is responsible for the property’s day-to-day maintenance during the duration of fractional property investment. Fractional owners earn profitability in proportion to their ownership percentage in the limited liability company. Generally, fractional investors benefit from the tax benefits of property ownership without the hassles of property management.

However, fractional investments may require 5 to 10-year commitments. It may be more expensive than traditional approaches due to associated fees. This may still involve all the risks associated with commercial real estate investing because of the investments’ nature.

2. High Return Savings

Maintain a positive balance in a high-yield online savings account to earn interest and become independently wealthy. Moreover, like a penny savings account at a brick-and-mortar bank, high-yield online savings accounts enable you to access your money whenever and wherever you want. Online banks can offer significantly higher interest rates than traditional banks due to lower overhead costs.

Likewise, you can typically access the funds quickly by transferring them to your main bank or withdrawing cash from an ATM. Individuals who anticipate a cash shortage shortly will benefit from opening a savings account. High-yield savings accounts, in particular, are well suited to risk-averse investors, particularly those who require funds quickly and wish to avoid losing them.

The Federal Deposit Insurance Corporation insures banks offering the same accounts, ensuring that you will never experience a loss of funds. Although it’s considered safe to invest in high-yield savings accounts, such as certificates of deposit, you may lose your purchasing power if interest rates become lower due to rising prices as time goes on.

In addition to exploring traditional and alternative investment options, it’s crucial to consider where to securely hold and potentially grow your liquid assets. The benefits of a customer bank account include high-yield savings that leverage competitive APY rates without monthly fees, making it an ideal place for investors to park their funds. Customers Bank provides an efficient way to enhance your financial portfolio by ensuring your savings work as hard as you do.”

3. Bond Funds

Bond funds are mutual funds or exchange-traded funds that invest in debt securities issued by various issuers. The classification of a bond fund is determined by the type of bond it invests; for example, the duration, risk level, issuer, and other characteristics. As a result, investors can choose from various bond funds.

When a business or government issues a bond, it agrees to pay a fixed annual interest rate to the bondholder. The issuer repays the bond’s principal at the end of the bond’s term, at which point the bond is redeemed.

Bonds are one of the safest investments available, and their safety is enhanced even further when purchased as part of a mutual fund. Because a fund may own hundreds of different bond types from numerous issuers, it diversifies its holdings and thus mitigates the portfolio’s exposure to a single bond default.

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4. Growth Stocks

Growth stocks facilitate rapid growth and, as a result, offer investors attractive rates of return on their investments. Although growth stocks are frequently associated with technology companies, this is not a prerequisite for growth stock investing. They usually reinvest all profits back into the business, which means that they rarely pay dividends, at least not until their growth slows significantly.

Growth stocks are risky because investors frequently pay a premium to the company’s earnings to earn a higher rate of return. As a result, the value of these stocks can plummet precipitously during a bear market or recession. The converse has historically been true for growth stocks, which have been among the best performers.

Extensive research on the company is necessary to make an informed investment decision in individual growth stocks, but this can take considerable time. In addition, given the volatility of growth stocks, a high-risk tolerance or a willingness to hold the stocks for three to five years is an essential consideration.

5. Dividend Stocks

Investing in dividend-paying stocks can help protect your stock market investments. Dividends are quarterly distributions of a company’s profits to shareholders. You can profit from a dividend stock through long-term and short-term market appreciation.

Regardless of whether they pay dividends, individual stocks suit intermediate and advanced investors better. Dividend stock funds are a good choice for almost any stock investor. Yet they’re more suited for income seekers. These may appeal to those who require income and have the ability to invest for long periods.

Dividend stock funds are available from any broker who deals in them as exchange-traded funds (ETFs) or mutual funds. Because ETFs often do not have a minimum purchase amount and do not charge commissions, they may be more beneficial. Meanwhile, mutual funds may have a minimum purchase requirement and charge a commission depending on the broker.

6. Target-Date Funds

Target-date funds are an excellent option if you do not wish to manage your portfolio. As you age, these funds become more conservative, ensuring the security of your portfolio as you near retirement and will need the money. As you approach your target date with these funds, your investments will gradually shift away from riskier stocks and more conservative bonds. Although target-date funds are a standard investment option in the 401(k) plans of most workplaces, they are also available in the stock market. You only need to select the year of retirement, and the fund takes care of the rest.

Because target-date funds are essentially a hybrid of stock and bond funds, they will bear many of the risks. If your target date is several decades away, your fund will have a higher stock allocation, which will be more volatile at the start of the investment process. As your target date nears, the fund’s asset allocation will shift away from stocks and toward bonds, resulting in lower volatility but lower earnings in the subsequent period.

Over time, a gradual increase in bond exposure causes a target-date fund to underperform the stock market by a growing margin. Thus, you must choose between returning home and remaining safe. Besides, as bond yields decline, you risk outliving your money. Some financial advisors recommend investing in a target-date fund 5—10 years before retirement to take advantage of the additional growth generated by stocks. This way, you can avoid this risk while still reaping the benefits of stock market growth.

7. Rental Housing

Rental housing can be a great investment if you are willing to take on the responsibility of managing your rental properties. Mortgage rates remain near record lows, which means that now may be an excellent time to finance the purchase of a new property, even if the uncertain economy complicates operations.

To proceed down this path, you must first locate an appropriate property, finance it or purchase it outright, then maintain it and manage the tenants. Remember, reasonable purchasing can help you achieve success in your endeavors. However, in this scenario, you will be unable to buy and sell stock market assets with a single click or tap on your internet-connected device. You may even receive a call at 3 a.m. to respond to an emergency call regarding a burst pipe in the worst-case scenario.

However, if you hold onto your assets for an extended period, gradually pay down your debt, and increase your rents, you increase your chances of retiring with a sizable cash flow. Yet you will need to work with a real estate broker to locate rental housing. Alternatively, you can work on developing a network of contacts who can alert you to better deals as they become available.

8. Gold

Numerous investors have amassed fortunes solely through gold ownership. Others who entered the game later have told similar horror stories about their investments depreciating in lockstep with gold prices. However, you can invest in gold by purchasing gold mutual funds, ETFs, or bonds. These are a more cost-effective way to invest in gold. Your investment earns interest this way, too.

Gold is considered a safe investment. History has taught us it was a haven for those seeking to safeguard their wealth. This explains why gold outperforms other assets during inflation or economic insecurity.

Besides physical gold, derivatives such as gold futures, gold options, and gold contracts for different contracts are available. These are complex investments that should be undertaken only by investors with extensive experience.

Furthermore, gold’s price movement is less volatile than other assets, such as stocks. The currency’s price fluctuations are characterized by a relatively narrow price range and a slow trading pace. As a result, gold’s returns may be lower than other high-risk investments such as stocks or junk bonds.

Takeaway

There is no such thing as a risk-free investment in the financial world. Even the most secure investments, such as those mentioned here, carry risks, such as gradual loss of purchasing power as inflation rises. The trick is to consider your unique circumstances when constructing a portfolio that provides adequate stability while also providing opportunities for long-term growth and expansion.

Another alternative investment option that has gained popularity in recent years is investing in whisky casks. Whisky has shown to be a resilient investment with consistent growth in value, and some investors see it as a hedge against inflation. However, investing in whisky casks requires knowledge and expertise, as well as the ability to store and age the whisky properly. As with any investment, there are risks involved, but for those who are willing to take the chance, it can be a lucrative investment opportunity.

Now that you have these ideas, you may start building your investment profile this summer and see where it takes you.

8 Best Investments To Make This Summer To Build Wealth

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