Four Types of Investments That Yield Long-term Results

Whether you're preparing for retirement or merely want to increase your net worth, investing is one of the most common strategies for building capital. There are many different ways that people choose to invest: from properties and stocks to commodities and venture capital, different investment strategies appeal to different types of people.

Some investments carry more risk but also more reward, while other investments are better suited for long-term, stable results. The type of investment you select will largely depend on your area of investment expertise and the time-frame in which you wish to reap the rewards. Today, let's look at the types of investments that can gradually yield huge profits as the years and decades pass.

Capital Gains Investments

The world of stocks and bonds is a vast and sometimes confusing place. Nevertheless, most wise investors who are banking on the long-term turn to this form of investment in order to earn large sums over years and decades.

By consulting with a professional designed to help you make the right investments, you can expect to earn anywhere from 5 to 10% annually on your investment over the long term. While you do have to account for inevitable taxes (use this capital gains tax calculator to figure out what you'll owe), most investors who balance for both yield and risk make fortunes in this method over the long-term.

Real Estate Investments

Another area where long-term investments can pay off is in the world of real estate. Many people purchase their first homes with the expectation that it will gain in value over time – most of the time, they're right.

However, there are many different ways to invest in real estate. Whether you decide to offer your properties through triple net leases or sublet properties from month to month, there are opportunities for both long-term and short-term investors. Since the value and cost of homes tend to only decline in severe economic situations, you'll likely watch your real estate investment grow in value and continue to deliver as the years pass.

Peer-to-Peer Investments

In the wake of the Great Recession, a new platform for investing appeared: peer-to-peer investments. Since many lenders were not willing to lend and since interest rates for investors dropped substantially, these platforms were able to incentivize both investors and borrowers alike.

There are dozens of trusted microlending and P2P investment platforms available for long-term investors to consider. While you are generally not protected in the event of a default, most micro-lending platforms allow investors to fund very small sums of the needed loan, making it possible for investors to contribute to dozens or hundreds of loans with as little as a few thousand dollars. In many cases, the annual return on investment with a diversified P2P approach can exceed 10%.

Credit Card Investments

Last but not least, there is another type of investment that can yield long-term rewards in a way you might not expect. Most credit card companies – eager to procure new clients and customers – now offer rewards and benefits for using their cards.

For everything from vacations to everyday expenses, you can responsibly use one or more credit cards to earn rewards, paying back the balance in full at the end of each month. In most cases, this results in no interest payments, but still provides benefits that exceed yields on most checking and savings accounts. Earning up to 5% on expenses you're already making – when the alternative is earning nothing on what you spend – is quite a sweet deal (and one that can yield long-term benefits).

These four potential investment strategies all cover different aspects of the economy and can produce differing levels of benefit over time. From earning rewards on money to creative passive income streams through other investments, building wealth over the long-term can be done through a responsible balance of multiple investment strategies.


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