8 Best Income Producing Assets to Grow Your Wealth

Best Income Producing Assets
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Curious about the best assets to build wealth? We have the 8 best right here! Learn the Best Income Producing Assets to grow your Wealth.

Introduction

For a lot of things in life, worry is unnecessary. We tend to over-analyze the potential consequences of things when we really can’t do anything about them. 

One of the few areas where it’s smart to overthink is when it comes to your future finances.

If you’re concerned about your bank account and how you’re going to reach retirement goals, you’re being smart. The sooner you realize this is a real problem, the quicker you can develop a solution.

Financial experts suggest the best way to build a retirement fund is to have your money do the work for you. But how does an average person do this without having a background in investments?

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The trick is to find prime income-producing assets. These are things you own that have value and, at the same time, can make you money in the future.

There’s no need to hunt down buried treasure to find these valuables, though. These eight assets we’re sharing with you are income-producers. With one, a few, or all of them, your wealth will grow organically, as will your investment knowledge. 

1. Certificates of Deposits (CDs)

If you’re just starting out and want minimal risk, CDs are the investment assets for you.

Short for “certificates of deposit,” CDs hold your money until a predetermined period passes. The longer the term you take out the CD, the more money you’ll get when you withdraw it.


The downside is that if you pull your money out early, you’ll have to pay the penalty.

CDs will make you more money than a typical checking or savings account. But not enough to get you rich, if that’s your goal. But they are very low risk, so they’re perfect for the cautious investor.

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2. Dividends

The idea behind dividends is a smart one. Companies that need investors, like insurances, entice them by offering a cut of the profits.

Shareholders receive extra shares in the company instead of cash. Those shares, or stock dividends, are non-taxable until sold by the holder. This way, the owner builds a profitable asset, and the company doesn’t have to pay taxes on it.

The more a stock splits and is divided, the less value it has at its share price. However, shareholders don’t have to put in more than they are comfortable with. They can pull their payout at any time after the holding period is over.

3. Stocks

Digital apps have made it much easier for newbies to start investing in what used to be a complicated arena.

When you begin your journey with stocks, you’ll run into two main options: index fund investing and individual stocks. 

Index fund investing is smart for the new investor. Costs are low, and you don’t have to know what you’re looking at to make daily or in-the-moment decisions.

Buying individual stocks, on the other hand, has more thought and risk involved. What you are doing is purchasing shares that make you part owner of the company. Chances are, you won’t buy enough to make any decisions, but if they do well, you do well.

Stocks dip and rise. If you sell them when they’re on the rise, you make a profit. If you try to offload them when they’re tanking, you take a loss. 

However, it requires a lot of thought and analysis. If you sell at the wrong time, you risk losing out on a spike or getting stuck with a failing company.

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4. Real Estate

Real estate has proven to be one of the most dependable ways to get a return on your investment. There isn’t too much more of a tangible asset than this one!

The best part? You don’t have to have a lot of money to go this route. 

You can start simple. Rent the spare room in your home, for instance.

Experts suggest that new investors don’t jump right into the actual real estate purchase. If you don’t have experience structuring a deal or negotiating with a seller, you’re better off with passive investment. 

Investing passively means that you’re “giving” money to companies purchasing apartment complexes. When they do well, your investment will pay off. You don’t have to do anything, which is why it’s a passive income stream.

As you grow stronger in your knowledge of investing and real estate, you can dabble in things like flipping houses and purchasing land.

5. Real Estate Investment Trusts (REITs)

Being a real estate investor is a lucrative way to make money, but it also has many downfalls and expenses.

If you’re intrigued by real estate’s potential but leery of the possible setbacks, REITs may be for you.

A real estate investment trust, or REIT, does the money and work side for you. They usually own a group of properties specifically purchased to produce income. These are places like hotels, apartment buildings, and offices or shops.

When you invest in a REIT, you get a passive stream of the profits when the trust rents the property.

6. Start a Side Hustle

Entrepreneurs are taking over the world, it seems. As the world goes digital, freelancing has turned into reputable work.

With the ability to attract a global market of consumers, it’s never been easier to turn your hobby into a lucrative gig.

Whatever you are good at, there could be a market for you, too. If you start a side hustle, you’re producing assets that grow your wealth. Use your new income to pay off debt or invest it.

7. Write a Book 

Royalties are another asset you can own and come from licensing your property. A common way to do this is to write a book.

With royalties, publishers sell your book. But since you still have “ownership” of it, you get a portion of the profits. 

You can always self-publish and keep all the money yourself. Self-publishing options make this simple, as long as you know the technology.

Once your book publishes, you must market it well. This is essential whether you went through a publishing house or a self-publisher. If you don’t promote your book, your audience won’t know it’s out there to buy.

8. Angel Investing

Startup companies and small businesses often need loans to get on their feet.

Traditional avenues through bank loans are difficult to get approved. That’s when alternative forms of lending through angel investors can save the day.

Angel investors step in and offer a portion of the necessary funds in exchange for a return of profits. This is a type of equity financing. 

Since the risk level is a lot higher with a startup than a stable business, angel investors can demand a higher return rate. Investing in a company that has a lot of potential could be your ticket to financial freedom.


Conclusion

Growing your wealth is a vague goal that you need to define to target your next steps. Whether you want to pay off debt, secure a stable retirement, or become financially free, these income-producing assets are the way to get there!

Author bio:

Caitlin Sinclair is the Property Manager at Portside Ventura Harbor with five years of property management experience and many more in customer service. She loves sharing her passion for her community and looks forward to making Portside Ventura Harbor the place to call home.

Caitlin Sinclair

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