{"id":170019,"date":"2014-02-27T04:00:35","date_gmt":"2014-02-27T11:00:35","guid":{"rendered":"http:\/\/getrichslowly.org\/blog\/?p=170019"},"modified":"2023-10-04T12:43:31","modified_gmt":"2023-10-04T18:43:31","slug":"8-investing-ideas-that-avoid-the-stock-market","status":"publish","type":"post","link":"https:\/\/www.getrichslowly.org\/8-investing-ideas-that-avoid-the-stock-market\/","title":{"rendered":"The 8 best investments other than stocks"},"content":{"rendered":"

\"A<\/strong><\/em><\/p>\n

Investing requires resolve and a long-term vision, but it doesn’t actually have to involve the stock market. Here’s a guide to non-stock investing options:<\/p>\n

<\/span>Precious Metals<\/span><\/h2>\n

During the Great Recession, precious metal commodities like gold and silver were all the rage. As the stock market lost more than 50 percent of its value, gold and silver started a monumental rise in price. Gold went from around $600 per ounce in 2007 to peak at $1,900 per ounce in 2011.<\/p>\n

The prices of the most popular commodities have since fallen from their peak; but had you invested in precious metals for that period of time (and others like it in history), you would have netted a healthy profit for your portfolio.<\/p>\n

Relying solely on precious metals for your portfolio is extremely risky, though, and I wouldn’t suggest it. However, commodities do tend to act in an opposite manner to the stock market, and using precious metals as a hedge against volatility can be a great strategy.<\/p>\n

Related<\/strong> >> Beginners’ Guide to Investing<\/a><\/p>\n

<\/span>Peer-to-P<\/strong>eer Lending<\/strong><\/span><\/h2>\n

Peer-to-peer lending<\/a> is one of my favorite alternative investments. It is the ultimate win-win for consumers. Consumer “A” gets a loan from Consumer “B” (and typically a large group of other investing consumers). Then Consumer A gets to pay off high-interest-rate credit card debt that stands at 20 percent with a personal loan that has a fixed term and a fixed interest rate of, say, 10 percent. This also means a fixed payment each month.<\/p>\n

For their part, Consumer B and his friends get to enjoy a much higher rate of return than they would be able to reach with cash sitting in the bank. Both sides win: The borrower gets a lower rate and a fixed term to pay off the loan while the lender enjoys a healthy rate of return.<\/p>\n

It’s true that some see peer-to-peer lending as a risky asset class because you are relying on strangers to pay the loan back. As with any type of investing, you don’t want to put all your eggs into one basket. Diversifying your portfolio of loans helps tremendously when you do experience a loan that goes unpaid. (Plus, P2P websites like Lending Club<\/a> and Prosper<\/a> have collection methods that kick in on borrowers who miss payments.)<\/p>\n

I’ve become so enamored with peer-to-peer lending that I decided to embark on a little experiment. I divvied up about half of my Solo 401(k )contribution into both Lending Club and Prosper. The goal of the experiment was two-fold:<\/p>\n

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  1. See how much interest I could make with this investment strategy.<\/li>\n
  2. Compare the two companies to see which one provided better earnings.<\/li>\n<\/ol>\n

    Overall, I was pleased with the results. Both companies netted double-digit returns for me, and I plan to add more money into these investments.<\/p>\n

    <\/span>Owning a Business<\/strong><\/span><\/h2>\n

    Hands down, I think the alternative investment with the highest potential rate of return is running your own business. This isn’t without risk — the vast majority of small businesses die within five years — but if you can outlast the statistics, it can be extremely rewarding.<\/p>\n

    I used to work for a company providing financial advisory services. I took a huge leap of faith, started a business<\/a>, and started blogging. My financial planning business has thrived and my blog has earned well over six figures since I started.<\/p>\n

    The beautiful thing about running a small business is not only are you the boss, but you can grow and maintain it as much as you want. Maybe you love your full-time job but you want to try out a new skill. Spend your nights and weekends trying it out, earn some extra dough, and keep working full time. Even a little side income can make a huge difference in your financial life, and when you don’t have time to maintain it, then slow down and focus on other priorities.<\/p>\n

    Related<\/strong> >> Best side jobs for extra cash<\/a><\/p>\n

    <\/span>Real Estate<\/strong><\/span><\/h2>\n

    If you’re interested in\u2026<\/p>\n