The following post is written by collaborator Jim Thompson.
With the rising cost of living, it is important for people to invest. If you have never invested before, you might be apprehensive about where to place your money. However, with high returns you do not have to invest a lot of money.
When you invest, you are planning for the future. While you have to use part of your money for living expenses and for events such as your wedding, complete with dresses from azazie.com, foregoing unnecessary consumption will pay off in the long run.
Here are the investments that you should consider:
Mortgage notes
If you want big returns, you need to invest in a profitable area that is relatively safe and has value. Mortgage notes are the easiest way to ensure a solid return. Moreover, you get all the advantages of owning property without any hassle.
According to Amerinote Xchange, sound investments are questionable in the current market but a real estate investment yields high returns. Mortgage notes are a sensible investment because people want to keep their homes, making it a win-win situation.
Certificates of deposit
This is definitely one of the most boring investments out there. With a Certificate of Deposit, you deposit cash for a specific duration of time in exchange for a guaranteed return. You will get a set rate of interest that does not change no matter how much the rates of interest fluctuate.
You will be locked in until the maturity of your term length. However, if you choose to withdraw early, you will be given a penalty that is equivalent to three months of interest. The interest that you earn depends on the rates of interest and the length of the CD term.
Treasury Inflation Protected Securities (TIPS)
The US treasury has many types of bond investments that you can choose from. If you are looking for a low risk one, choose TIPS. These types of bonds have two methods of growth – the first is a built-in inflation protection and the second is a fixed interest rate. In the former, your investment’s value will rise with whatever inflation rate occurs during the time that you have the TIPS.
Municipal bonds
When a local or state government needs to borrow funds, they do not use credit cards; they issue a municipal bond. These bonds are exempt from Federal income tax, and this makes them a smart investment if you are looking to minimize your tax exposure.
Why are municipal bonds safe? They allow you to avoid income tax and the probability of the borrower defaulting is quite low. In recent years, there have been some huge municipality bankruptcies, but it is uncommon.
A government can always issue a new debt or raise taxes to pay off its old debt, making a municipal bond quite safe.
Annuities
Annuities are a good option for investors who need assistance in stabilizing their portfolio over long periods. Purchasing an annuity involves making a trade with an insurance company and there are many different types of annuities. You pay a large sum of money to an insurance company and they give you a guaranteed return.
The return can be fixed, variable, or dictated by the stock market. If you get a guaranteed return, your risk will be much lower. Instead of Federal government backing, it will be backed by the insurance company that holds your annuity.
Cash value life insurance
This insurance pays a death benefit to your beneficiaries once you die and permits you to accrue value with an investment section in your payments. Cash value life insurance can be further divided into universal and whole life insurance.
Are you wondering what the best investment for you is? You cannot just select one of these blindly. You should consult a financial advisor or take some time to read about them comprehensively. That way, you will not make a bad investment decision.
Author Bio:
Jim Thompson
Title: Super-Connector at OutreachMama
Jim is a super-connector with Towering SEO and OutreachMama who helps businesses find their audience online through outreach, partnerships, and networking. He is a professional writer who has been in the business for 5 years. He has hands on experience with cars, tech, and relationship advice, among other things. Because of how quickly he can turn articles around, he is able to take on multiple projects at once. His writing experience spans from SEO articles to technical guides and everything in between.
