It’s one of the greatest feelings in the world when you put your capital on the line and win big. If you’ve experienced this feeling, you know what I mean. If you haven’t, you’ve come to the right place. High return investing is the icing on the cake, a level that you get to when you’ve done the hard work of laying a solid financial foundation.
In this article, I’m going to assume that you’ve consumed at least some of my other content, and, therefore, you wouldn’t dream of putting all of your resources into risky high return investments. I’m also going to assume that you know how to do your homework on any investment that you’re considering jumping into. Finally, I’m going to assume that, whatever your net worth, the majority or even vast majority of your investments have been made in “safe” vehicles that provide a reliable return.
Remember, high return investing is only high return if you choose correctly.
I think of risk this way: not taking any risk is actually a risk. And every asset you have is an investment. Even cash in and of itself is a kind of investment vehicle. When you hold US dollars, for instance, you are making a bet that the dollar will hold its value—and at this point, that’s a risky bet, as inflation is increasing all the time. Cash may feel safe, but that doesn’t mean that it is safe.
There should always be a solid rationale behind the investment moves that you make. That way, if and when your investment loses traction, you won’t panic because you’ve done your homework. High return investing takes enough knowledge of the given industry you’re investing in to be able to look into the future, or at least to make an educated guess about what will happen. Otherwise, you’re just gambling. And, well, gambling is fun, but it’s not an investment strategy.
My favorite high return investment is real estate. It’s how most of the wealthiest people in the world got where they are. First, we’ll take a look at high return property investments, and then we’ll consider some alternative ways that you can enter the world of high return investing.
Mitigating Your Risk When Investing in High Return Vehicles
As investors, we are always trying to push the envelope. We want to take control of our own destiny, and we play to win. That said, we can sometimes be impatient for high returns when what we really need is patience.
Is the first real estate investment you make in your twenties going to be a high return property investment? Probably not. And you know what? That’s exactly how it should be. The knowledge and experience that you will gain from starting small will build confidence and wisdom for the future.
Here are some of the things I’ve learned over my lifetime of making both safe and high risk investments:
Diversify—I can’t repeat this enough: most of your investments should remain in stable, reliable investment vehicles. Exactly what percentage makes sense for you is ultimately up to you and depends on your age, net worth, family status, and a myriad of other factors.
As you hopefully know by now, the Indestructible Wealth Method involves creating multiple streams of income that you add to over time, giving you and your family a wide base of safety and increasing passive income that you can reinvest and use for non-essential purchases, luxuries, vacations, and other experiences.
Use debt wisely—Investing in real estate is practically like taking candy from a baby. However, this doesn’t mean that you can’t lose in real estate investing. In our lifetimes, we’ve seen the real estate bubble pop spectacularly, and no doubt it can happen again. But taking out a loan that someone else pays back for you is a proposition that I have won with over and over again, and I continue to recommend it enthusiastically to my coaching clients.
Pool your resources—Now more than ever, it’s possible to carve out a small piece of the pie, however big that pie may be. There are vehicles in virtually every sphere that allow you to pool resources with like-minded investors to mitigate the risk and get your feet wet in your chosen area of investing. ETFs, REITs, Real Estate Partnership or RELPs, farmland funds, and the like are equivalent to mutual funds on the stock market but are targeted to niche investors with specialty interests.
Stay in your lane—Doing what you know has never been as important as it is in high return investing. Not all of your investments can—or should—create high returns, so choose this tranche of investments wisely.
If you’ve built your wealth so far in real estate, branch out to other areas of real estate investing and do something that has a bit more risk and a higher return. If you majored in history or political science in college, or if you’ve traveled extensively or lived abroad, consider leveraging that knowledge and experience to invest in emerging markets. If you have a track record of choosing stocks wisely, take the next step and invest in an IPO.
Don’t try to reinvent the wheel here, unless you genuinely have a fascination with an area you haven’t probed before. If crypto is calling to you, heed the call and learn everything you can. If you eat, sleep, and breathe crypto, trust me, you will find a way to get in on some potentially high return investments. They are out there in every imaginable type of investment, but it takes creativity and smarts to find them.
High Return Property Investments
When we’re talking about real estate investment, we are generally talking a long term investment, unless you intend to flip the property. It’s important to understand the trends in the cities or towns you’re considering investing in and to have a handle on their medium to long term outlook. Market bubbles and crashes are not so significant over a 20 to 40 year time horizon, and real estate is an investment you should generally plan to hold onto for quite some time.
Getting started with self storage—When getting started with real estate investing, you might want to keep things ultra simple. Self-storage units are one of my favorite real estate investments (and possibly one of the industry’s best kept secrets). Here’s why. There are no toilets to clog. There are no carpets to replace or walls to repaint. People want their stuff, so they almost always pay. When they don’t, there’s no one to kick out, and there’s collateral in the form of the stuff they’ve stored, which is already in my possession.
But there’s more. Self storage units are cheap to build and cheap to maintain. There is the potential for additional revenue generation when renting out space for parking RVs and boats. And the great news for new investors is that self-storage REITs, or Real Estate Investment Trusts, allow you to pool your resources with other investors, so the barrier to entry here is quite low.
Homes and condos—OK, it’s time to buy! As you can probably guess, one of the tricks to high return property investing is choosing an area that is about to be popular. Getting into an area with decent amenities or a good school system that hasn’t taken off yet is a challenge, but it’s also part of the fun. (And yes, you are allowed to have fun with your investments!) There are numerous resources online that will help you choose the right property for your needs and budget.
If you’re going to be investing in multiple properties, one consideration is whether you should keep them all in one area or diversify. Keeping everything close gives you the opportunity to manage them yourself if that’s attractive to you. Diversifying your area reduces your risk. If one area loses value, properties in other areas may pick up the slack.
Flipping—Flipping homes has acquired something of a romantic mystique in the last few years, but I can tell you from experience that it requires a great deal of skill. Sometimes, it feels like everything that can go wrong with a property flip does go wrong. At the same time, it can be a highly lucrative way to make money with high interest property investing in a relatively short period of time. Loans referred to as “bridge loans” may be available to the borrower in the value of the home once the repairs are completed. Bridge loans can provide the financial resources to get the home ready for sale. If you have the skills, home flipping can certainly be a high return investment.
Property management—When you buy, you will have a big decision to make: do you manage the property yourself, or hire a management company to do it for you? Of course, you may not have a choice; if you don’t live locally, then a property manager is a necessity. But even if you do live locally, you might want to let an expert coordinate maintenance, collect rent and chase late rent payments, and keep the property occupied with well qualified tenants so that you don’t have any gaps in your rental income. There is a cost to this, of course. A property manager will typically charge between 6 and 12 percent of the monthly rent payment. Whether you want to use a manager and make this investment completely passive or not will depend on many factors.
Other real estate investments—Once you get a taste for real estate investing, that enthusiasm can really feed on itself, and you may find yourself looking for alternative high return property investments that diversify your portfolio even further.
- Billboards and display advertising—You could install a billboard to rent out on one of your properties. You could also invest in a specialty real estate investment trust that pools the resources of those who invest in billboard advertising. Across the range of options, this high-performing market can yield big returns in the right areas.
- Venues—Investing in stadiums, malls, sports facilities, and other entertainment venues is a novel concept that can be leveraged with our old friend the REIT.
- Parking spots—Like the self-storage investment concept, parking spots are similarly a low-maintenance investment that can pay off if you invest in areas with high traffic and a shortage of parking options. Another idea is to create your own parking lot on a piece of vacant land in a city or town that is short on parking.
- Farmland—Another REIT-rich opportunity is farmland investing, which rents land out to farmers who can’t afford to buy their own.
- Manufactured homes—With the trend in tiny homes over the last decade, manufactured homes are becoming more attractive and accepted with renters. At the same time, they are under-utilized by investors. Investing in mobile home parks is also a lucrative opportunity and may continue to increase in value as financial global markets continue their uncertain trajectories.
- Coworking spaces—With entrepreneurship at an all time high, small business owners need a place to hold occasional meetings, receive mail, avail themselves of receptionists, and, sometimes, just just get out of the house and into a space with others who are working on their dreams. There are REITs that serve this space as well. Another option is to rent out your extra office space on an as-needed basis.
Other High Return Investments
Cryptocurrency—I talk a lot about crypto on my podcast, on my blog, and on my social media channels. There are few, if any, high return investments that have the potential for higher highs—or lower lows. Picking crypto may seem as random as playing the lottery; however, if you understand the technology behind it, there is method to the madness.
Certain cryptos will increase in value over the long term, in part because the technology they are built on, the blockchain, will make our lives faster and easier. A crypto worth investing in has value for its constituency because the technology supporting it has something to offer to a particular industry or vertical market. Researching crypto and weeding out the ones that will ultimately be worthless—and let’s just say that’s most of them—takes quite a lot of expertise as well as some foresight and luck.
There are a number of ways to get in on crypto and to make the crypto you have work for you. Lending your crypto, mining new crypto, investing in companies that are mining crypto…crypto is a world unto itself. This high risk, high return investment should be handled with care.
Individual stocks—Here’s another area that requires deep knowledge in order to make money. If you don’t, stick to a mutual fund that diversifies your risk and gives you a predictable rate of return. However, if you do know what you’re doing—or are willing to learn—working the stock market could be a high return investment area that can work for you. Investing in high return stocks is not for the faint of heart, but it has brought great wealth to many people who had the emotional fortitude and foresight to make it work.
Emerging markets—Investing in developing economies takes a true understanding of global trends and dynamics. With the interconnectedness of our world, a ripple on one side of the globe can often be felt in numerous other places, and the consequences can be far reaching. Investors in emerging markets need to be prepared for a potential roller coaster ride, as the upward trajectory is rarely smooth and even. To limit your risk, consider leveraging an exchange traded fund, which allows you to invest in a whole country or multiple countries’ economies.
NFTs—Digital assets are gaining ground as more and more of our lives play out online. And with the advent of the Metaverse, NFTs could become a household phenomenon virtually overnight as users want to create their own space with virtual property, clothes, skins, and who knows what else!
So what are NFTs, or non-fungible tokens? NFTs are usually entirely digital assets that are nonetheless unique and have some sort of mark that shows they are one of a kind.
Have you ever wanted to “own” a meme? Now you can. Or maybe you’d like to own the rights to a cartoon ape (one of 10,000 similar but unique images that exist only on the Ethereum blockchain) and gain access to the exclusive Bored Ape Yacht Club.
Actually, I’m sorry to report that if the ape is up your alley, you’re in for disappointment. What launched in 2021 with each ape costing the equivalent of about $200 could now cost you tens if not hundreds of thousands of dollars. As of this writing, the 7-day sales volume of these bored ape tokens totaled $90 million! The highest sale price of a single ape was over $600,000, and some apes have actually been auctioned at Sotheby’s.
Before you ask, “Is this really a thing?” Let me answer: this IS a thing. File this one under truth is stranger than fiction. With a sales volume of around 20 billion in 2001, NFTs could turn out to be high return investments—if you choose the right one at the right time.
IPOs—Initial public offerings should generally be reserved for investors who really know what they’re doing. Is there potential for a high return when investing in an IPO? Of course there is. But volatility is the norm, especially in the first two years of the offering.
It’s imperative when considering investment in an IPO to do deep research, which is often not easy to come by. Reading the prospectus is only the beginning. It’s important to understand what makes the company’s offer unique and how it stacks up to its competitors. A wise investor will do everything they can to discover the health of the company in question and assess its future earnings outlook. Read press releases, study the company’s place in the overall industry, even talk to customers if you possibly can. It is possible to win big with the right IPO, but successes are few and far between.
Your Source for High Return Investing Advice and Education
My content and mastermind groups are geared to help you get to the next level, whether you’re just getting into investing, or whether you’ve been at this game for 5, 10, or 20 years or more. Investing in high return vehicles is risky by definition—whenever there’s a potential for high returns, there’s usually a correlated risk—but I will have your back as you forge ahead into greater and more lucrative opportunities.
The Indestructible Wealth Method shows you how to make the most of the investment dollars you have, allowing you to see exponential returns on what you would have been able to achieve on your own. Through my proprietary methods for creating multiple passive income streams, you can finally get on the path to self determination and financial freedom.
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