Got some money you’d like to invest? Research has shown that millennials aren’t as interested in investing as previous generations. We’re more risk-adverse and fewer of us are gambling our money on stocks and shares. However, investments needn’t always be a lottery. Here are a few low-risk ways that you could make some money out of your savings.
The most risk-free form of investment is to open up a savings account from a bank. Banks will pay you a fixed amount of interest on these savings. Unfortunately, the interest that banks give you nowadays is minuscule making this not an ideal investment strategy for those wanting to make a big return. It’s worth shopping around banks to compare different interest rates. Banks will warn you with a letter or email if interest rates fall.
Bonds are a little different than regular savings accounts as they aren’t issued by banks but companies and organisations wanting to borrow money. They can be sold on to other investors and generally have a more variable interest rate. Whilst not all bonds have the same security as savings accounts, there are still some protections laws in place. You can usually get a lot more interest out of them than regular savings accounts.
Government bonds are one of the best options for beginner investors as they’re practically as secure as savings accounts. You’ll find short-dated and long-dated bonds (the minimum amount of money required to start a bond will vary). It’s worth doing your research into different kinds of bonds before putting your money somewhere.
Utilities such as gas, electricity and water will always be in demand. Buying a stock from the right utility provider is likely to be a stable investment compared to other stocks. Utility providers have been known to pay lucrative dividends to shareholders for decades. As with other stocks you should always do your research first.
Peer to peer lending
Online peer to peer lending sites are a new and exciting way of investing your money. People go on these sites looking for loans. Multiple people are able to pay towards a person’s loan. Each lender then gets interest on the amount they’ve lent after a certain period. Unlike many forms of investment, you can lend as little or as much as you’d like. Obviously, the more you lend, the more interest you’ll make.
You get to choose the things you want to invest in. That said, not all peer-to-peer lending sites will protect their lenders, so if someone you loan money to doesn’t pay back their instalments, you could end up losing all the money you’ve lent. To minimise this risk, make sure you’re going through an established and credible site that offers protection to its users. Read reviews by users first before getting involved.
The days of investing in oil are coming to an end. Not only are fewer people buying shares in oil due to ethical reasons, sustainable energy is now proving to be just as profitable. Take wind farms as an example. Whilst wind turbines may cost a fair amount of money to build, they cost very little to maintain. Consequently, people have found that they can make huge returns by investing in a new wind farm project. There are of course risks that locals may protest for a wind farm to be ripped down, but generally these are very secure investments if you do your research and make sure the locals are behind it.
There are other forms of green technology that have shown signs of being a good investment such as solar panel companies and biofuel producers. Many find such investments to not just be rewarding financially but on ethical level too.
Gold has long been a go-to investment option. This because whilst the value of gold fluctuates, its unlikely gold will ever drop significantly in value. Whilst there may be times when it’s worth less, those patient enough to wait a few years generally see a steady incline.
Getting into the gold investment trade does require thorough research. It’s worth shopping around for gold dealers as they’ll all be selling at different rates. You may decide to buy a gold bullion, a share in some gold or even a gold antique or artefact. On top of working out where to buy gold, you need to do your research when it comes to selling gold. This will all help you get the best deal out of your investment.
Buying a property and renting it out is still one of the most profitable investment plans. The demand for rented properties is on the rise as fewer people are able to buy. Most people with money to put into property are put off by stories of bad tenants who refuse to pay rent or damage a property. Whilst this can be a risk, thorough research and planning can avoid this. Buying the right property, screening your tenants and having legal contracts in place are just some of the ways that you can protect yourself. You may even be able to hire a property manager to eliminate the stress and take care of screening potential tenants.
You even have the opportunity to sell the property, which may rise in value. By making certain renovations, you may be able to boost the amount that this value rises.
Not everyone may have the deposit to put down on a house or apartment. Some people have found that they can earn more with a property abroad, which they rent out as a holiday home. By hiring a foreign property manager, you can get all the screening done for you. For those on a tighter budget, you may even be able to let a room out in your home to a lodger. Some landlords may even allow tenants to sub-let rooms (you should always ask your landlord for permission). You may even be able to buy a land to use as an allotment or even buy a parking space.