Point to point loan

Peer-to-peer Lending platforms such as Lending Club and Prosper are in second place this year with extra cash. With these companies, you can lend to individuals small increments as if you were a bank. The best part is that you can get decent returns – usually more than 6 percent or more.

As an investor in peer-to-peer lending, you are investing in other people and their goals. It’s comforting to know that you won’t lend to someone who doesn’t know a lot of money. On the contrary, the amount of money you invest in is divided into $25 increments in hundreds or even thousands of loans.

While it may seem strange to hear a financial adviser advising people to invest in peer-to-peer lending, I’m not the only one who recognizes the value of these platforms. Clint Haynes, a financial adviser in Kansas city, told me that for several reasons, he supported peer-to-peer lending as an alternative to the stock market. First, these companies can easily register and start using. Second, for safer loans, your rate of return may be between 5 and 7 percent, and for riskier loans, the rate of return is higher. Last but not least, you can usually open a new account for as little as $1,000.

The real estate

In addition to the stock market and peer-to-peer lending sites, the third investment strategy to be considered this year is real estate. The problem is, I’m not suggesting that everyone use up and buy property. After all, not everyone is turned down as a landlord.

Of course I’m not. I tried to invest in real estate seven years ago and almost lost my shirt. I learned a lot from my career as a landlord’s lesson, and one of the biggest is that I don’t need that kind of pressure.

Fortunately, there are many ways to invest in real estate without material possessions. One option to consider is to invest in real estate notes. I started investing in real estate notes because one of my real friends smashed it with real estate and offered his friends an opportunity to invest.

He would buy a lot of real estate, and investors like me would invest in his projects. From there, he would manage the properties and pay me the dividends or interest on the money. For me, this is an attractive way to invest money without being a landlord or dealing with tenants.

Obviously, there are big risks in this situation. You must be very trusting to invest in individual real estate notes.

The good news is that there are other ways to invest in real estate in addition to real estate notes. One of the things I’m really excited about is a company called Fundrise. Fundrise offers similar investment options. They buy commercial property and allow investors to invest small sums of money. Clearly, this is another non-intervention investment. You may have part of a commercial real estate project, but you don’t even see or deal with the property itself.

Fundrise, like Lending Club, needs about $1, 000 upfront. However, once you invest, Fundrise mostly lets you “set and forget it”. Better yet, you might get a fairly high rate of return through this platform. On the company’s website, Fundrise claims that its average return over the past five years was between 8.76% and 12.42%. Not too shabby.

Obviously, such a platform also has venture capital. First, the company updates, so it doesn’t have decades of data sharing. Second, you let a third party represent your choice of buildings and investments, which means you give up all control.

In any case, I think technology is cool for investors to get commercial real estate in ways that they couldn’t get in the past.


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