8 Ways to Invest Without Buying Stocks
I’ve long argued that the stock market is just one area for investors. The stock market is often seen as the default place to invest, but this absolutely isn’t a justified assumption. The stock market only outperforms inflation by a few percentage points — if even that.
The stock market is also absolutely and hideously volatile and absurdly risky. Bonds can be much safer, but they’re almost always very low-earning the safer they are.
Plus, even if your stock is performing well, there’s always a risk of fraud, the entire market taking a plunge regardless of stock, and you have no control over the company unless you own a huge portion of said company.
The Best Alternatives to Stocks and Bonds
This isn’t the first time I’ve said these things, and I’ve been receiving a lot of emails and messages from readers who want to know what they should do if not stocks or bonds. Here are some alternative ways to invest
Because of this, let’s look at some alternatives to the stock market when looking for proper investments. These are all potentially lucrative moves — my favorite are those dealing with land, property, and commodities.
- Woodland. If you can get into this asset, it’s been hands down one of the best investments to own in the last few centuries. It typically outperforms the S&P 500, out-earns inflation by a mile, and is less volatile than the stock market. Less risk, more rewards. The only catch is it usually takes millions of dollars worth of land to get started, unless you want to oversee the work yourself. There are some woodland stocks, but they’re publicly traded, meaning they can be pretty volatile. The majority of woodland owned and harvested in America is privately owned, meaning if you know how to hunt and peck, you’re probably more likely to find obscure deals.
- Farmland. Similar at least in strategy to woodland investing, investing in straight-up farmland has been one of the oldest investing strategies in the history of mankind. If you own food-producing resources, you at least won’t starve. Because food shortages and food prices are increasing, this is one of the best investments for the next few decades. You can buy farmland and also lease it out to larger agricultural companies for a mostly stress-free, almost passive income.
- Small Farm. If you’re a more “hands on” kind of person, running a small farm can be a great move. Almost anyone with substantial retirement savings can buy a small rural farm and purchase enough cattle to live off of with a healthy income. Again, this isn’t for everyone.
- P2P Lending. This is something mainstream investing publishers don’t cover nearly as much as they should — lending to regular people. P2P lending now happens online through websites like LendingClub and Prosper. I’ll be writing more about this in the coming weeks, so make sure to subscribe.
- Small Business. You don’t have to own publicly traded stocks to invest in a long-term business. You can simply invest in your own small business. For example, I own Stand Strong Media, which publishes Stand Strong Research. This has been, by far, the most important investment decision of my life. Of course, starting a business is absolutely incredibly risky — but if it pays off, it really pays off.
- Private Equity. In line with the idea of owning your own business, private equity allows you to own part of a business that isn’t publicly traded. While this means it’s less liquid, it often usually means you get a higher chunk of income, and are more likely to find a cheap deal. Private equity is great — especially if you have enough money to influence leadership and direction of the company, assuming you understand business.
- Gold and Silver. Bullion isn’t publicly traded, though plenty of ETFs are trying to at least make this not-always true. You can learn more at gold and silver prices or live gold prices.
- Rental Property. Again, this one is more common than most of the above investments, but can also be risky. If done correctly, this can allow you to make a fantastic “passive-ish” income by owning a few houses.
Don’t forget — diversification isn’t just good for a stock portfolio. It’s always good to diversify. If you’re going to invest at all, try to invest in at leas 3-4 of the above investments.
Owning a rent home, P2P lending, some farmland being leased out, as well as some boring publicly traded companies can allow you to find a level of financial security that most can only dream of having.