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Without a doubt, all of us want to earn more. But, the question has always been, how?
In this article, you will read 10 of the easiest tips and techniques to earn a 10 percent rate of Return on Investment (ROI). While you might think that this percentage is too little, note that these savings can sum up a large amount of money when accumulated. Find which of these ways works for you and your situation, especially during recession and pandemic.
Top 10 Ways To Earn A 10% Rate of Return on Investment
1. Real Estate Investing
One way to earn a 10 percent ROI is real estate investing. There are multiple mechanisms to do this. You can choose to rent out your property. Just make sure that the rent rate is more than your monthly mortgage or loan payments. If you don’t want this type of real estate endeavor, you can try other methods too.
You can also buy and sell homes to earn an income. A pro tip here is to invest in single-family rental homes. These types of homes sell like pancakes.Experts even claim that these types of houses will continue to grow even during and after the pandemic. With the work-at-home option growing popular, people choose to stay in these comfortable and affordable homes even with a high rent rate or an expensive price tag.
If you want to venture into the market of single-family rental homes, you might want to check out companies like Roofstock. The company is dedicated to this type of rental service. They offer to buy, own, and sell rental homes, so this is the best place for you to find potential clients and customers. They are one of the best in the industry, but you can surely look for other companies in the same field.
If investing in single-family rental homes is not right for you, you can also try to invest in real estate debt. Here, you can invest in the loans made to borrowers. As these borrowers pay back their loans, you get to earn you money as well. The nice thing here is that you do not need to manage the property while being part of the thriving real estate investing industry. You can check out Peerstreet if you want to try this out.
Another option to enter real estate investing is to invest in corporations that give dividends or dividend stocks. It may take time before you profit from these real estate investments, but they are relatively more stable sources of income. They are for a long term investment. You might have to wait for five years for your first dividend, but you can earn per month or per quarter after that. Check out Fundrise or Streitwise if this type of real estate investing works for you best.
2. Paying Off Your Debt
If you have an existing loan, chances are you are losing a lot of money because of the interest rates you are paying back. One easy way to earn a 10 percent Return on Investment is to pay back your loans so you can save money. The longer you are keeping your debt, the higher the interest rate you are paying. By doing so, you are no longer charged with the interest rate each month, thereby making you save a ton of money per month.
Just think of this scenario – your credit card debt charges you around 16 percent per month. The longer time you wait to settle your debt, the more money you have to pay the loan agencies per month. The same goes for your other loans. For example, student loans have big interest rates, so you have to pay them back as soon as you can.
If you cannot avoid taking loans, you have to apply to the best credit institutions or to take the best credit cards available in the market. Only take loans with fair and reasonable terms. If you fail to do so, this could hurt your finances in the future.
3. Long-Term Stock Trading
To invest in stocks for the long term, you have to get in touch with an investing company and let them manage your money. Long term stocks are conservative because the Robo advisors or financial advisors put your money into various businesses. They are the ones to choose an option for you. In doing so, you, as an investor, are not taking too much of a risk.
One downside of this type of stock trading is that it might take months or years before you start earning money. But once your investment has given your due diligence, you can start earning high returns.
If this option fits you and your financial goals, you can contact a trusted bank, a discount broker, or even a smartphone app. A financial advisor or Robo advisors will then choose where to put your money.
4. Short-Term Stock Trading
In long-term stock trading, you make trades for a long period of time, like for several months or often years. In contrast, in short term stock trading, you buy-and-hold trade quickly in days of weeks. This is a riskier type of investing because you are only given a short period of time to make trades. The short term fluctuations in the market can potentially turn you into a financial success overnight or potentially lose your savings.
Honestly, the short term stock trading is not meant for everyone. There is a learning curve if you wish to do this for a living. Remember to read various resources before jumping into this market to come in ready and prepared.
5. Starting Your Own Business
If you have a trust issue and would not allow other people or organizations to manage your money, you can always start your own business. Once you build a successful business endeavor, you can ensure your continuous 10 percent earning per month.
To get started in your own business, you have to begin looking at the market familiar. If you are a fan of a fashion, technology, or food trend, make your business revolve around things you know and love.
One of the best tips when starting your first business is to use your personal capital. This is to minimize the risk of being in debt. You do not need to start big here. You can start small, grow your business, and then acquire investors once you are confident about your business plan.
If you plan on investing in a small enterprise, you should get familiar with Facebook, Twitter, Instagram, or other social media marketing tools. These are affordable and easy-to-use tools proven to attract the money market. With limited funds, you might have to do much of the work in the first few months of your business.
6. Art and Other Collectibles
Do you know that your collection hobby can be turned into a profitable business as well? Art and other collectibles can diversify your investments. Make money by buying popular collectible items, keeping them in good condition, and then selling them to the right customers. Navigate Facebook, Twitter, and Instagram to know what items are hot among collectors.
Some of the common collectibles in the market today are books, toys, legos, paintings, and many more. Popular media items, ones released by corporations like Disney, Warner Brothers, Mattel, etc. are also safe bets when it comes to earning your 10 percent ROI. And of course, try to stick on the market that you are already familiar with. If you are into Harry Potter, for example, start your collectible items within this realm.
7. Create a Product
If the stock market or real estate investing does not appeal to you, you can always try to make products that could entice people. One of the useful tips in creating a product is to get an education about the industry before designing or developing a product.
You do not just produce something and sell it to others. Instead, you have to gather the necessary information from your potential clients to ensure that you create a marketable and profitable item.
When creating a product, do not limit yourself to the fashion or food industries. For one, digital products are popular among younger consumers today. You can create a blog, vlog, website, or other online products and earn 10 percent of ROI monthly.
8. Junk Bonds
Given the economic crisis we are currently facing, investing in junk bonds can be the best investment option you can do today. Junk bonds refer to bonds rated below investment grade by the top rating agencies in the country. Most investors would not choose to invest in junk bonds because they carry a higher risk of default than other bonds. But, take note that junk bonds have the potential of significant price increases when the company’s financial situation improves.
Remember that investing in junk bonds is like betting to a given business. This means that before investing, you have to gather all the relevant information to bet on the business that is likely to be a success in the next months or years. If you have to invest in the right junk bonds, the return can be big for you.
9. Peer-To-Peer Lending
Peer-to-peer lending, otherwise known as P2P lending, is a mechanism where lenders are matched to borrowers. You have to use a third party business like Lending Club or Prosper.
In Lending Club, for example, you can earn a rate of return on investment of over 10% per year. For more conservative investments, the ROI is at 6 percent, while for more risky investments, you can even earn a return on investment of 20 percent or more per year.
10. Master Limited Partnerships
There are basically two paths to take under the master limited partnerships. First is the so-called limited partnership is where you provide capital for the business and eventually receive income distributions. Here, you become an investor because of the money you gave to the business as their capital.
On the other hand, there is the so-called general partnership. Here, you help manage the business. Eventually, you get a return on your investment in the form of a compensation basis monthly.
Note that Master Limited Partnerships is similar to trading stocks. They can be risky and are not for every investor. If you wish to proceed, you might want to consult a financial advisor before committing as an investor.
Which One is Right for You?
If you have some funds in your savings accounts, your money is sleeping because of the extremely low-interest rate it earns from the bank. In some cases, inflation could even decrease the value of your funds. If you truly want to improve your personal finance and grow your funds, you have to start building your investment account. As an investor, begin with the industry familiar to you.
Before investing, you have to be certain how much money from your savings account you are willing to use in investing. Also, create a target on when you want to start earning your ROI. All these factors are essential in choosing which type of investment you are willing to make.
While not necessary, it will not hurt you to know the basics concepts in finances and investing, including inflation rate, interest payments, money market fund, credit score, government bonds, and many more.
You do not need to invest a large sum of money. You have to be certain that you are investing in a field with a high rate of return or a growth rate. Make the right decisions by getting insights, suggestions, or education from groups and individuals who are experts in investing. There are more tools online than ever that could make you start earning that 10 percent ROI of interest monthly.
As seen above, there are more ways than ever to start earning that ROI of interest monthly. If you are afraid to start investing, financial websites, consulting firms, and business organizations can be found on the Internet. These groups and individuals are willing to help you and guide you in investing your finds to rightful businesses or endeavors.
One of the most reliable financial websites today is Investoralist. We have tons of reading materials, tips, and guides for you. We can help you understand seemingly complex concepts like compound interest, day trading, real estate investing, mutual funds, money market funds, and more. Just send us your queries and concerns, and we will provide you the necessary information you need.