If you are fortunate enough to be in a position that you have the capital to invest or otherwise use with a view to increasing your current wealth then there are multiple ways in which you can use this money, to make more money. The phrase you have to speculate to accumulate bears some fruit in situations such as these. So if you are looking for some inspiration to put your wealth to good use and earn more than it would sit in a low-interest savings account here are some top ideas for how you can use your money to make money.
Buy property
Investing in bricks and mortar has long been a proven success for professional and novice property owners and investors. When it comes to buying property there are several different options you could consider to see a return on your investment.
Firstly, if you are buying a second property other than your permanent dwelling consider buying it as a buy-to-let purchase whereby you will take on the role of the landlord of the property and lease it out to tenants. The good news is you do not have to purchase the entire property outright to see a return on your investment. If you need the help of a mortgage you typically need to invest around 25% of the purchase price on a buy-to-let property. Once you own the property you can put tenants in place to pay you rent which in turn pays your mortgage. Typically this is a long term investment that could see you own property having only invested 25% of the original purchase price and associated buyers costs. As property prices notoriously increase over time this could turn out to be a very savvy long term investment. Once the mortgage has been discharged or if you are able to buy a property without a mortgage then any rental income you receive will be profit and passive income
Another option is to buy a property and instead of having regular tenants in situ, this second property could be a vacation home that you rent out at a premium rate on a short term basis. With the expansion of websites such as Air BnB renting out a vacation home has become much more accessible and potentially provides a very lucrative return.
Finally, your third option in terms of buying a property with a view to turning a profit is to buy a property that is in need of renovation. Typically these properties are sold under market value to allow for the level of work that is required to make them desirable homes. You then complete the necessary renovations at your time and expense and re-sell the property, hopefully at a profit. This is also known as flipping properties and if you have the right skill set and or contacts to assist with the renovation work then there can be a considerable profit to be made.
Buy a business
Perhaps you have always fancied being a business owner but do not have the know-how, time or inclination to set up a business and build it from the ground up. If this sounds like you then consider buying a pre-existing business.
Buying a pre-existing business can have a number of advantages;
- The groundwork has already been completed in terms of getting the business up and running.
- It is likely to have a pre-existing customer base, reliable income and reputation to build on, you wouldn’t be buying it if it didn’t.
- A market for the products or services offered by your business should have already been identified and tapped into.
- Practicalities such as premises, contracts, staffing, marketing etc are already likely to have been established and be up and running.
- It may be easier to obtain finance as the business could have a proven track record.
- It may have existing employees already in situ who know and understand the business.
- Potential problems with the business are likely to have already been discovered and rectified.
Investing in a business can be a very lucrative move. If it is something you are considering be sure that you have a qualified legal team to go over all of the paperwork and ensure that all matters are as they seem and the sale proceeds in the interest of all parties. If you are looking for an already established biz for sale start by looking at online directories and making inquiries from there.
Photo credit; Anna Nekrashevich from Pexels
Buy stocks
Stock market trading is no longer reserved for city investors working on Wall Street. In fact, the stock market has evolved in recent years and the effect of the pandemic has seen a notable shift in the trading industry. As so many people have been forced to stay at home and found themselves relieved of the duties of their usual day job there has been a real-time rise in the number of non-professional investors who have started dealing in stocks and shares. All of this has been done from the comfort of their own home and by easily accessible apps such as Fidelity.
Buying stocks is by no means a guaranteed way to make money with money and you can just as easily lose the money you have invested if you don’t tread carefully. If you are considering investing in stocks then spend some time doing a little due diligence and researching the market and of course the stocks you intend to invest in. Make sure you understand the basics and stay apprised of all current affairs and business news that may affect stock prices. If you are not confident in your ability to invest in the stock market then you can always hire the help of professionals. Professional stock market brokers can invest money on your behalf and this may well limit an element of risk in terms of your investment. Don’t forget however no trade is completely risk-free no matter how experienced your broker is. Also, opting to pay someone to invest on your behalf will result in you having to pay them a fee for their services. You have to decide if this is a price worth paying.