Five Smart Ways to Use Your Money in 2018

There comes a time in your life when you want to start investing on your future instead of just spending money on short-term needs. If you think 2018 is the year you start doing that, then it’s high time you start looking for smart opportunities that will yield the best returns for your money. As you can see from the following list, there are many investment options for you to choose from, and each comes with its own unique risks and rewards.

Before making your decision, you need to do a bit of self-evaluation to assess what kind of risk you are willing to take. Are you conservative and more concerned about saving up for retirement, or are you aggressive, and do you want high returns within a relatively short span of time? It’s been always tough to compare investments in these ways, but luckily professional services are available here to help make the decisions. Once you have identified your risk tolerance and objectives, you can start considering these four investment opportunities for 2018.

Invest in Peer-to-Peer Lending Online

Today’s globalized and technologically advanced society has made peer-to-peer lending a very promising and game-changing investment opportunity. Also known as crowdlending and social lending, this type of investment involves lending money to other people without using a formal financial institution to act as intermediary.

Through this method, you will be able to financially support borrowers across the world who are pursuing various projects and causes, whether those be a tech start-up in India or a small online shop.

There are many online platforms that streamline peer-to-peer lending, and as a lender, you can choose how your money will be used; you can lend it to individual borrowers or spread it across many loans. You get to determine what type of risk to take, and as in any kind of investment, the higher the risk, the greater the possible returns, but also the greater the chance of loan defaults.

Invest in the Cannabis Industry

There are twenty-nine states that approve the use of marijuana, either for recreational or medical purposes, but more states are expected to follow suit. In the first quarter of this year, California earned $60.9 million in tax revenue, and sales are expected to reach $5 billion by 2019, which goes to show how lucrative and promising the weed industry is.

If you live in a state where marijuana is legal, you can open a licensed dispensary for marijuana and sell products such as oil, edibles, and cigarettes. Just make sure you comply with the state laws and requirements to avoid litigation. If you’re not interested in selling marijuana, you can at least be a reseller of drug-testing detox kits, which are helpful in getting rid of toxins and ensuring that marijuana use does not impair a person’s ability to perform safety-critical work.

Buy Stocks

It may sound like basic, even overused, advice, but there’s a reason the stock market remains an attractive investment option after all these years. Compared to bonds or antique coins, stocks have the highest potential returns, and they generally perform well over the long term. One important thing to keep in mind, though, is that the stock market is very volatile, so expect the value of stocks to fluctuate regularly.

If you are new to stocks and are still wary, you can manage your risks by following an investment technique known as dollar-cost averaging. This practice involves buying more stocks when market prices are low and purchasing few when the prices are high. Through this method, you will be able to get promising returns while lowering the average of your share price.

Invest in Real Estate through Notes or Online Platforms

Buying real estate may sound tempting, but keep in mind that not everyone is cut out to be a real estate manager. Compared to other types of investments, owning physical property requires more hard work because you need to maintain your asset and possibly deal with tenants. In addition to that, real estate has very low liquidity, and when the timing is wrong, you can end up selling your investment at a loss.

But don’t let these risks put you off from investing. You can still enjoy the rewards of this type of investment by going for mortgage notes instead. This involves working with a savvy real estate investor who will purchase various real estate properties.

As an investor, you lend him money he will use for managing his assets, and he will then pay you interest from the amount he borrowed from you or give you dividends. The obvious risk in mortgage notes is you have to be working with a person you really trust.

If you do not have any trustworthy candidates in mind, then you may want to consider an emerging trend of online platforms, which will let you invest your money in various commercial properties. This is similar to peer-to-peer lending, but the focus is on real estate. Online real estate platforms let you invest in real-world properties without the real-world stress that comes with property management.

Health Savings Account

There is no reason you should not invest in your health. You can contribute to a health savings account by deducting a particular amount from your taxes. Over time, the investment will increase, tax-free. In the event that you need the money to pay for a qualified medical-related expense, then you can readily withdraw funds.

The peace of mind that comes from knowing you have funds you can readily use in the event of a medical emergency is priceless. This type of investment can also work as a retirement plan. You can withdraw the total amount you have saved in your health savings account, including interest, when you reach the age of sixty-five.

Final Thoughts

Many of today’s cultural and technological advancements have made investing easier and more rewarding. However, investing will always carry risks, so you need to exercise caution and do your part in understanding which opportunity best suits your financial goals and capacity.

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