There are many ways to put your money to work if it’s sitting in a bank account. The most common wisdom is to invest in total market stock funds to gain safe exposure to the market. However, some people are looking for something different.
Alternative investing has been getting more popular as of late. Recent reports show that there are now $13 trillion in assets in alternative investments.
The question is, do any of those alternative investments make sense to you? Below are some of the best alternative investment opportunities in 2023 that are worth considering.
Real Estate
Real estate is one of the most common alternative investments available. Since real estate is normally stable over time and gradually increases in value, it’s an excellent option for people who want to purchase assets to maintain their net worth.
The great thing about real estate is that you can invest in multiple ways. If you don’t want to hold homes long-term, you can fix and flip homes that need work. For people looking for a longer-term investment, they can purchase rental properties.
You also have real estate funds available if you don’t want to buy real estate yourself. REITs are funds that pay dividends to their investors. The dividend you receive is based on the profit the fund makes.
Artwork
Art is another investment available to you as you begin to make more money. There is a lot of value in artwork, and serious collectors will pay a lot of cash for the art they enjoy.
This is an even better investment if you have an interest in art. You don’t only get an asset you can place in your home.
You also get an asset that will retain its value over time and can be sold later.
If you don’t want to risk holding art yourself, some funds allow you to buy fractional art pieces. They work similarly to a REIT in that they are funds that pay dividends to the people who own an art piece.
Peer-to-Peer Lending
Traditionally, individuals who need extra cash turn to banks and other lenders to get the money they need. However, those services aren’t always available if you don’t have an excellent financial history. Even if you have no bad records, you can be turned down for having no credit history.
That’s why many people turn to peer-to-peer lending. Borrowers turn to individuals with higher net worth to get smaller loans.
You can take advantage of this if you’re a qualified investor. You can browse lists of people who want personal loans and fulfill parts of those loans. You can see each individual’s financial data to ensure the risk is right for you and get paid interest over time as the borrower pays back the loan.
Cryptocurrency
Cryptocurrency hasn’t always been considered a great investment. It wasn’t proven, so many investors hesitated to invest money in the crypto markets.
However, you see more people than ever today who decide to invest in crypto. It’s been proven as an investment vehicle for a while now, and people across the globe take advantage of it. Being able to transact globally is another bonus.
On top of that, you can buy NFTs on blockchain networks. NFTs are digital art and other digital goods. Read the history of crypto art to learn how it came to be and why people are jumping at the chance to purchase NFT art.
Commodities
Commodities are physical goods that people use in every life. They include gold, silver, oil, natural gas, and other resources.
Some people buy and hold commodities like gold and silver in their homes. However, this can get cumbersome over time. Many people stick to traditional investing methods by purchasing a fund.
People usually use ETF funds to buy commodities. These funds allow you to buy as many commodities as you want without dealing with storage issues.
Since these resources are normally in demand, they usually stay stable in price.
It makes them a great way to preserve your wealth against inflation and occasionally make a profit because of price increases.
Angel Investing
Angel investing is a great option for high-net-worth individuals who want to contribute to business growth. Many new companies don’t go immediately to banks to get cash. They want partners who can help grow a business and not just a lender.
This is what angel investing is for. Instead of giving loans to companies, you invest money and take equity in the business.
Since you have equity in the business, angel investing has a much higher upside than other investment opportunities. But at the same time, there is much more risk with the high risk of business failure.
Venture Capital
Venture capital is similar to angel investing. Startup companies will seek accredited investors to offer funding in exchange for equity. But there is one big difference with venture deals.
These deals are normally much bigger. You can normally do angel investing on your own. However, venture capital deals typically happen with bigger funds.
This means you’ll need to find a venture fund to invest in to access these deals. You also need to be an accredited investor and be able to prove you have a high net worth.
Don’t Look Past Alternative Investments
You owe it to yourself to set yourself up for success in the future. Unfortunately, this won’t happen if you let your cash sit in the bank account and become devalued because of inflation.
Although normal investments are a great way to put your money to work, alternative investments also present even more opportunities. Remember the types of investments above as a way to increase your wealth.
Did you find the alternative investment guide above useful and want more financial tips? Head back to the blog to learn more about controlling your finances.
