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Options Besides Stocks For Investing

Sep 16, 2008
The idea is as simple as it can get-acquire a land property and resell it for a profit. Investing in lands or real estate can be rewarding in many ways. With enough money at hand, one can simply put up a two-bedroom apartment and have it leased. The rent is a regular income already. The land itself can be leased to interested parties, without additional pay out for construction.

Lands are considered assets, and as such, they appreciate in value as time passes. Especially when the real state is a prime property or located in a commercial area, financial institutions usually take them as collaterals in exchange for loans as much as 80 percent of the property value. The investor, then, can leverage on the loan through other investments, and earn by the time of maturity.

Compared to stocks or bonds, real property is more stable in terms of pricing, since it is less liquid. It may prove disadvantageous to some investors, but for those who prefer a more long-term return on investment, they will do well to consider buy-and-sell of lands, with or without fixtures. The flipside is that this kind of investment requires a sum of money.

Insurance Policies
There are life insurance policies that offer dividends, as annual premiums are paid over a stretch of ten to fifteen years. The return is not only with the interests earned, but also with the insurance coverage. It can be risky, because mismanagement can happen to some insurance companies. It is best to entrust investment with those who have proven track records, and whose portfolios are also diversified.

Lend to Others
Government corporations and other businesses sometimes sell bonds to the buying market in order to raise funds for expansion or infrastructure on a large-scale. To invest in bonds is simply to lend one's money to others at an expected interest on returns, at a certain maturity date. The usual schedule of maturity for bonds is semi-annual. Prospective investor must be careful of bonds being sold at interest rates higher than what the government offers. The returns on investment may also fall short of the inflation rates, as bond prices usually decline when there is an increase in interest.

The Piggy Bank
Yes, it pays to save up. This is the earliest form of investment, but also one that takes so much discipline and diligence on the part of the investor, who is usually a middle-income employee. It should be wise to have a specific intention for it, and not just for the sake of stashing money, so that there is a clear objective on how much money should be put aside. Some people are saving up for emergency situations, but most if not all do so for retirement. The investment is secure and easily accessible since it is liquid. The return, however, is minimal; banks usually provide, at most, only a five-percent annual interest rate. But savings done on a long haul can reap benefits for the investor. That is, with enough patience and self-control. It may not be a good investment strategy for impulsive buyers.
About the Author
Justin DeMerchant is the founder of hydra trade, financial software, and stock trading tool where information on stocks and investing can be found.
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