Invest in income properties
RentCafe reports that the average monthly U.S. rent is $1,739. If you have the funds to buy a rental property or the ability to finance one, you can earn a nice amount of extra income without having to put in the work of a second full-time job. And while being a landlord does require some time on your part, it may be comparable to that of a manageable side hustle.
There’s also the option to outsource landlording to a property manager. You’ll lose some of your rental income to their fee, but you’ll be buying back time.
Invest in real estate without the headache of being a landlord
Imagine owning a portfolio of thousands of well-managed single family rentals or a collection of cutting-edge industrial warehouses. You can now gain access to a $1B portfolio of income-producing real estate assets designed to deliver long-term growth from the comforts of your couch.
The best part? You don’t have to be a millionaire and can start investing in minutes.
Learn MoreInvest in real estate without owning physical properties
Owning rental properties carries risk. And unless you’re willing to hire a property manager, it can eat up a lot of your time. You may, instead, want to invest in real estate without actually owning real estate by investing in REITs, or real estate investment trusts.
What makes REITs a lucrative bet is that they’re required to pay at least 90% of their taxable income to shareholders as dividends. Because of this, a portfolio of REITs might provide more steady dividend income than a portfolio of traditional non-REIT dividend stocks.
Build a diversified stock portfolio
There’s no need to limit yourself to REITs if you’re looking to invest your money. Assembling a diversified portfolio of stocks could set you up with regular dividend income and large gains over time. To be clear, though, this strategy works best when you’re holding your stocks for decades.
The stock market has historically delivered an average annual 10% return, accounting for years of strong performance and years of declines. If you have $10,000 to put into a stock portfolio over 30 years, at a yearly 8% return, which is a slightly more conservative but perhaps more realistic estimate, you’re looking at growing that sum to about $100,000.
Of course, you don’t necessarily want to take your gains each year and spend them, as that will limit your money’s ability to grow. If you need the cash, you can always withdraw your dividend payments instead of reinvesting them. But if you’re willing to sit tight, reinvesting your dividends can be an even better option.
If buying individual stocks doesn't fall within your comfort zone, an alternative way to invest your money is to buy shares of an S&P 500 ETF (exchange-traded fund). With this approach, you're investing in the broad market instead of hand-picking top companies. It's a nice way to get an instantly diverse portfolio without having to do much legwork.
Of course, any time you have investments, whether they’re physical properties or shares in stocks or REITs, it’s important to keep tabs on them. But that’s still a lot less effort than working 100 hours a week to boost your income.
The richest 1% use an advisor. Do you?
Wealthy people know that having money is not the same as being good with money. Advisor.com can help you shape your financial future and connect with expert guidance . A trusted advisor helps you make smart choices about investments, retirement savings, and tax planning.
Try it now
