In the world of investments, there are few places where your money is risk-free. However, there are more financial products designed to simultaneously maximize safety and returns. This means that you can count on getting your principal back, as well as a pretty sizable interest rate. Here are a few ideas to get you started:
Peer-to-Peer Lending
After the most recent financial crisis, it was no surprise that banks tightened up their lending portfolios and stopped handing out money. Unfortunately, consumers still needed access to private loans, so a band of investors got together and created peer-funded loan programs. At first, many people doubted that these services would survive for long, but they have proven themselves sustainable and safe. These groups have instituted risk management programs to ensure that the loans they fund are reliable, while charging notably higher interest rates than traditional banks.
Bridge Loans
Real estate is an industry that we cannot escape. Even during the toughest of times, real estate has shown promise for investors. Instead of going the residential route, many investors are looking to commercial bridge loans for safer and higher returns. Bridge loans are often insured by the mortgage company orchestrating the deal so you can be guaranteed a solid return of around 6% with a good chance of up to 9% returns.
Life Settlements
Life settlements provide an unusual sort of security in the fact that they are free and clear of our financial markets. This means that you can invest in life settlements on the secondary market with a guaranteed return and no worries about whether stocks are headed up or down. While this kind of investment relies on timing, it does deliver consistently in double digit percentage rates. Make sure you research before you consider life settlement investments so you understand how the whole agreement works and when you can expect to see your payout.
These are just three safe alternative investments with great returns. By moving outside of stock investments and savings accounts, you can stretch your money without fear of losing it. If you're just now hearing about alternative investments, many financial advisors have been slow to offer these products because they tend to be more investor driven and often function independently.
Contact us to learn about alternatives that can work for you.
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