Being a freelancer or entrepreneur has been really good to you. You listened to everything wfh office has to say on building income streams and creating passive income.
Because freelancing is a feast and famine career path.
Maybe you got into real estate. Maybe you’re a gamer who is making extra Money with streaming.
Either way, you’ve got extra Cash. What do you do with it? Keep reading to find out.
Investing your money can be scary. There is no such thing as a “safe investment”. There is always a risk and potential to lose it all.
However, some investments are safer than others and some of them are safer if you decide to have more control. Let’s take a look at a few ideas.
The Stock market is the best place to put your money. The key to making money isn’t working. It’s taking the money you make from your work and then making that money go to work for you. As far as safety, dividend stocks are the way to go.
Find some stocks that give a nice dividend return and place your money there. If all of the stocks you invest in have at least a 3% dividend, you’ll get roughly $30,000 a year for every million you invest.
This idea freaks a lot of people out. Dividend stocks don’t see a lot of growth. The point of dividends is to provide you with interest in the form of dividends, but the cash is essentially being held in a savings account. In essence, that one million dollars is making you $30,000 in profit every year and you can pull the million out whenever you want.
Growth stocks are where the biggest risk is. Think Bitcoin, for example. Marijuana stocks. Stocks that are relatively cheap now that people think are going to blow up and make them a ton of cash. Everyone is looking for the next Apple or Amazon stock. Then they sell off those holding and hold them in dividend stocks for the long term. At least, that’s the idea.
Other options include index funds, ETFs, and mutual funds. While there are some differences between them, they all function in a similar way. As far as the market goes, the answer is in diversity. You want a mix of all of these options to have the safest portfolio you can.
Opening franchises require a lot of money. Most of them want to see a net worth of $500k or more to even be eligible.
However, once these things get rolling, many of them are cash cows. Franchises like McDonald’s and Dunkin’ Donuts pull in six figures a year in profit for the owners. If you have a high net worth, money to burn, and you’re looking to do something proactive with your money, then getting into franchises could be a great option for you.
Angel investing is when you are a silent partner. Think Shark Tank.
A friend or someone you know has a business idea, but they need capital. You have capital. So you give them money in exchange for a stake in the business.
This is a truly risky investment and angel investors build wealth by putting their money into a variety of different companies. Most of these startups crash and burn, but one or two winners will bring in millions of dollars.
It’s a high-risk, high-reward kind of thing and most people aren’t willing to part with that much money for something that isn’t guaranteed.
This is a crowd favorite and something we’ve written about a little bit on wfh office.
You take your extra cash and buy a home. You rent it out. Let’s say your mortgage on the property is $600 a month. You charge $1,300 for rent. Once you pay taxes and insurances and your mortgage, everything else is profit. The higher your down payment, the more equity you’ll have in the property and the lower your payment will be. You can rent it forever or sell it in ten or fifteen years for a profit.
Rental property empires are a great way to sink money into something when you don’t trust the stock market or you’re looking to diversify your portfolio.
Once You Have Money
Once you have a lot of cash laying around, you’ll find there are probably going to be a lot of hands out looking for a little something.
Wealthy people need a great accountant and a great attorney to keep themselves and their money safe.
When you die, those hands wanting a little something extra are going to turn into ravenous wolves. This is why you should look into an estate plan for your money and investments, especially if you want these funds to go to a particular place or set of people. You can read more about that here.
Try to Relax
As an entrepreneur, we know it’s hard to turn the switch off and relax. You find success, you want more of it, so you push yourself to constantly work on the next project.
It’s ok to take a break or a vacation. You need to make time for your friends and family.
They are the reason you work hard. To take it easy for a while. Not everyone has it in them to do what you do and it’s ok to be proud of yourself and treat yourself.
Building income streams, especially passive income streams, is the cure for those freelancer blues. When times are hard, you need to make money another way.
At some point, you’re going to reach this level if you’re willing to work hard enough. Then, the smart thing to do is to put your money to work so it can earn you more money as you move on to bigger and better things.
This will keep you from worrying about the cash and trying to micromanage it. Scale your business and your brand and don’t try to do everything yourself.
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