One of the most important decisions that most people have is properly planning for their financial future.
In almost all cases, a big part of this will be investing wisely. For those that have investable assets today, there are five key investment options that should be considered, which would provide a strong investment return and diversified portfolio.
When you are looking to prepare financially for the future and have investable assets today, the first thing you should do is maximize your retirement account benefits.
If you qualify and have the availability to do so, you should focus on maxing on your 401 k contributions every year and even maxing out your Roth IRA contributions. Both of these investment options will provide you with the ability to receive long-term tax benefits, which will help you build more wealth over time.
When investing through retirement accounts or simple brokerage accounts, the best long-term investment option is to invest in the stock market. Over the long haul, the stock markets have the proven ability to increase in value at around 7% per year.
When investing in the stock market, it would be a good idea to diversify your investments to ensure you will not lose a sizable amount of money if one company or industry lags.
Another option for investing your money is to focus on the energy sector. The energy markets seem to be at very affordable levels and now appears to be a great time to invest and capitalize.
In the coming years, the price of oil will likely start increasing back up towards its peak, which will then lead to an increase in other energy stocks as well. Some good options include investing in oil companies, energy ETFs, or solar firms.
The third investment option to consider is real estate. While real estate has been turbulent for the past few years, some experts consider it today to be a great option.
By investing in real estate today you will be able to lock in very low rates for a long period of time. As interest rates increase, so will rental rates, which will help you, earn an even higher return on investment. When investing in real estate you will need to ensure you have the capacity to handle any issues that could arise, which could include vacancies, maintenance issues, or problems with tenants.
While they may cost some extra money each month, hiring a management company to handle the management and leasing of your property could alleviate much of this concern.
The fifth option for investing your money is in alternative investments. There are a wide range of alternative investments today that can provide you with high ROIs.
Some of the most common will include investing in micro-lending or crowd-funding investments, which give you the opportunity to get good returns in investment-grade assets. Other options would be investing in payday loans or vehicle title loans, which provide investors with very high returns.