You know what they say: “new year, new investment!”. Well, even if they don’t say that, we’re already a quarter of the way through 2021.
With so many different non stock investments to choose from, there really is no good excuse to have an undiversified portfolio.
Count on the fact that investing in 2021 will be slightly different from 2020.
The new decade is going to bring many different alternative investments, so make sure you don’t put too many eggs in any one basket. So, with all the different choices and landmines out there, which ones should you take a serious look at?
We took a deep dive into all areas of alternative investments and came up with a comprehensive guide that will make you lots of money, or save you lots of money from going all in on a dud.
Pay Off Your Debt
Before we talk about things that are seen traditionally as investments, let’s talk about a non-taxable return: paying no interest.
Say you have $20,000 in credit card debt and you’re being charged an interest rate of 20%. That means you’ll be paying $4,000 in debt a year. Once you pay off that balance, your return on investment is completely guaranteed! You won’t be bleeding capital to a financial institution in the form of interest.
So, before getting ready to commit capital to an alt or any investment, make sure to pay off any high-interest loans or debt.
A major source of debt for the majority of Americans is credit card debt… So, try not to follow the herd on this one.
Alright, we’ll get off our soap box.
Invest In Yourself
That’s right. You heard us. Investing in yourself might be the best thing that you can do in 2020. If you work a traditional 9-5, learning new skills and acquiring new certifications can pay for itself many times over.
Heck, reading our blog every week will pay off for you.
We are putting a lot of time, effort and money into helping educate potential investors, so take advantage of it. There are also credible online courses, college curricula, industry trade expos, and even credible YouTube channels and educational programs.
A more diversified skill set can bring new opportunities, new promotions, and a bigger paycheck.
Taking time to really research alternative investments can help you to win big. Don’t just jump right in.
We took our time in outlining all of your different options here so stay tuned if you want to know the real winners.
Real Estate Invest Trusts (REITs)
Flipping houses isn’t for everybody. Traditionally, when people think about real estate, they think about buying individual properties or complexes and then renting out those units to tenants.
This can quickly turn into a full-time gig – and many people don’t have the time nor the patience to invest in real estate that way. If you are looking for very passive cash flow, this can be a decent option for you because investing in a real estate investment trust allows you to profit from the real estate world without getting your hands dirty.
There are many online crowdfunded real estate platforms that let you invest directly into multifamily apartments and commercial properties.
This is a great way to instantly diversify your portfolio and put your money into the real estate sector.
The only problem is that REITs perform like stocks and are subject to many different market volatilities. There are also so many people, managers, regulations involved in REITs that you pay for it with your returns.
REITs are also EXTREMELY tied to the real estate market. What does that mean? If you were invested in a REIT in 2007 and 2008, you probably lost about 40% of your investment. (https://www.thebalance.com/what-are-reits-416837)
As alternative investments go, we think REITs are fair to midland.
Items like gold and silver will probably be worth something until the end of civilization.
While sometimes seen as volatile, metals like gold and silver make a great hedge when investing in dollar-based and currency-based is uncertain.
Physical 0.999 fine gold bars and rare coins, as well as silver bars and silver coins, are a favorite with many investors because they are very tangible.
What does this mean for an alt investor?
If the market goes into free fall, the market moves to quality, tangible investments.
This is called a Flight To Value, or a Flight To Quality. (https://knowledge-leader.colliers.com/editor/tenants-market-causes-flight-to-value/)
In times of uncertainty market makers many times move to precious metals, Swiss Franks and US GOV’t Bonds.
Expert Tip: Also, silver’s price does not always move with gold, so investing in both will diversify your risk among this asset class.
We rate previous metals mid to high on our scale. Own some, but don’t make it your entire portfolio. (Not this should not be constituted as investment advice, we’re just talking as friends)
The Best Alternative Investment Of 2021, Merchant Cash Advances
After the hours of reading books, pounding the pavement speaking with investors, and following return trends, we found a hidden gem.
You might ask, are there still hidden gems in the market?
The answer is yes, because this hidden gem hasn’t been part of the market until recently.
So what is it, how does it work, and how can you profit from it?
Our top non stock investment is Merchant cash advances, otherwise known as MCA’s.
An MCA is an ADVANCE on future PROFITS of a business.
Why are they a good investment, and why haven’t you heard about them until now?
MCA’s are a growing industry, already calculated at 20 Billion dollars according to Debanked (https://debanked.com/2019/08/gold-rush-merchant-cash-advances-are-still-hot/)
The industry has grown over the last 20 years because banks have become much more stringent with their lending policies.
What hasn’t changed, is that businesses need money. They need money to grow..
- Businesses need money to fulfill large contracts.
- Businesses need money to buy inventory.
- Businesses need money to make payroll when they have net 90 day contracts that make them wait to get paid.
Since businesses need money, and they can’t always get their money from banks, they go to alternative funding markets.
Enter, the merchant cash advance.
Some very smart people, about 30 years ago, set out to solve the business funding problem. Why? Because they were business owners struggling to get funding. They didn’t qualify for a traditional loan.
The merchant cash advance was born. MCA’s are an alternative form a funding.
Joe owns a funding company.
Bob owns a pressure washing business and signed a government contract to clean graffiti off all the highways.
Bob’s business is new and doesn’t qualify for a credit line but needs money to fulfill his big contract.
Joe steps in and advances Bob the money to fulfill the contract.
Bob pays back the advance, as he gets paid on his contract.
Now, 5 other Bobs start 5 other companies and call JOE for an advance.
Joe can’t fund them all.
Joe asks an accredited investor if he can help fund the 5 new advance opportunities.
In layman’s terms, this is what has occurred in the MCA industry and it has opened up new and extremely lucrative opportunities for accredited investors to leverage their capital and make great returns through funding cash advances.
A new marketplace exists where accredited investors can easily apply and start accessing funding opportunities today.
Over the last five years, the merchant cash advance industry has exploded, which has invariably tightened competition and the practices of funding companies that hand out the advances.
Knowing a borrower’s intent can be everything when it comes to investing, and finding the right funding companies to choose can be difficult. Luckily, online crowdfunded platforms like Supervest allow investors to choose the MCA funding companies and individual businesses to invest in.
Imagine trying to bet on the next Facebook, Apple, Airbnb, and LinkedIn. If you cannot launch a business or vision due to time constraints, consider investing in someone else’s. Investing in startups can be one of the riskier alternative investments, but if you invest wisely, some of your seed money can turn into a giant payday. Just imagine being part of the seed rounds for companies like Facebook and Spotify! If you invest in private placements or IPOs already, this might be a great fit for you.
Alternative Investment Opportunities
One of the most unique investment opportunities of 2021 is the release of the Supervest platform. Accredited investors from across the United States are starting to see how lucrative investing in the merchant cash advance space can be.
Supervest bridges the gap between accredited investors and MCA funding companies. Accredited investors need new low-risk & high-yield investments to diversify their portfolio.
MCA funding companies need more capital to continue to fund small business growth in the form of merchant cash advance contracts. When an investor signs up for Supervest, everyone wins.