Top 10 Investment Ideas for Beginners (2019 Focus)
Embarking on the journey of investing can feel daunting, especially when faced with a plethora of options and complex financial jargon. But fear not, aspiring investors! The year 2019 presented a unique landscape of opportunities for beginners seeking to grow their wealth. This article will explore ten of the best money making investment ideas tailored specifically for those just starting out, offering a blend of risk tolerance, accessibility, and potential returns. Understanding these options can empower you to make informed decisions and begin building a solid financial future using these money making investment ideas.
Understanding the Investment Landscape in 2019
Before diving into specific investment ideas, it’s crucial to understand the economic climate of 2019. Interest rates were generally low, and the stock market experienced periods of both volatility and growth. This environment favored a diverse approach to investing, balancing potentially higher-yield options with more stable, conservative choices.
- High-Yield Savings Accounts: While not technically an “investment,” a high-yield savings account offers a safe and accessible place to park your cash while earning a better interest rate than a traditional savings account. This is a good starting point for building an emergency fund.
- Certificates of Deposit (CDs): CDs offer a fixed interest rate for a fixed period. In 2019, longer-term CDs offered slightly higher rates, but consider your liquidity needs.
- Low-Cost Index Funds: Index funds track a specific market index, such as the S&P 500. They offer instant diversification and typically have low expense ratios.
- Exchange-Traded Funds (ETFs): ETFs are similar to index funds but trade like stocks. They offer flexibility and diversification across various asset classes.
- Bonds (Government or Corporate): Bonds are debt instruments that pay a fixed interest rate. Government bonds are generally considered safer than corporate bonds.
- Real Estate Investment Trusts (REITs): REITs allow you to invest in real estate without directly owning property. They can provide income through dividends.
- Peer-to-Peer Lending: P2P lending platforms connect borrowers with investors. This can offer higher returns, but also carries higher risk.
- Robo-Advisors: Robo-advisors use algorithms to manage your investments based on your risk tolerance and financial goals. They are a convenient and affordable option for beginners.
- Dividend Stocks: These are shares in companies that regularly pay a portion of their profits back to shareholders. They provide a steady income stream, and the share value can also appreciate over time.
- Crowdfunding Real Estate: This allows smaller investors to participate in real estate projects by pooling their money with others. It can offer potentially high returns, but also comes with illiquidity and project-specific risks.
Comparing Investment Options
| Investment Type | Risk Level | Potential Return (2019 Context) | Liquidity | Minimum Investment |
|---|---|---|---|---|
| High-Yield Savings Accounts | Low | Low (around 2% in 2019) | High | Varies |
| Low-Cost Index Funds | Moderate | Moderate (S&P 500 averaged 29% in 2019) | High | Low (can buy fractional shares) |
| Peer-to-Peer Lending | High | High (but variable, 5-10% typical) | Low | Varies |
Diversification is Key
Regardless of which investment ideas you choose, diversification is essential. Don’t put all your eggs in one basket. Spread your investments across different asset classes to mitigate risk. Consider your risk tolerance, financial goals, and time horizon when building your portfolio.
Risk Tolerance Assessment
- Conservative: Focus on lower-risk options like savings accounts, CDs, and government bonds.
- Moderate: A mix of bonds, index funds, and REITs.
- Aggressive: Higher allocation to stocks, P2P lending, and potentially crowdfunding real estate.
As you reflect on the investment landscape of 2019 and consider your financial goals, remember that money making investment ideas are diverse and cater to various risk profiles. Thorough research and understanding of each option are crucial for making informed decisions and building a secure financial future. Good luck!
