Let’s say you have just sold your second home and have about $300,000 in your bank account. You can’t have such a large amount of money lying in your bank account for too long; you have to find a way to invest it, so that it gives you a much better return.
How are you going to do it? First, let’s talk about the things you should not be doing when you receive a large inheritance or received a lump sum from a lottery or from the sale of a property.
- Don’t invest in Ponzi schemes hoping to get high returns. Yes, anything that promises to double your money in 2 months is a Ponzi scheme and cannot be trusted.
- Don’t gamble away your fortune at a casino in Vegas! That would be a ridiculous thing to do.
- Don’t buy things you don’t really need, such as an expensive sports car, or a diamond necklace.
- Don’t lend to your friends or family. Sure, that’s going to make you popular in the short run, but in the long run, you will lose all of it.
- Don’t invest in a foolish business idea or in investment ideas that you don’t really understand.
Right, let’s talk about the 3 best ways to invest a large amount of money in 2018
#1: Invest in rental properties.
The best way to grow your wealth is to make your money work for you. Which is the best investment where you have your money working for you? Well – investing in rental properties. Buy a good house or apartment(s) in a busy part of the town, close to where the offices or colleges are. Rent out the property to students, families or young professionals. This will help you earn a good, solid income every month. Just be careful with the rental contracts and screen every tenant before renting out your property to them.
#2: Invest in High Dividend Stocks.
I love high dividend stocks, and guess what, Warren Buffett loves them too. Buffett made his billions from investing in solid, old fashioned companies that have been around for many, many years and have never failed to send a good dividend check to stockholders every quarter. Companies like Coca-Cola, Gillette, Wells Fargo, Exxon Mobil, and Chevron fit into this category. Don’t expect any sudden appreciation in the stock price with these companies, but you will get a good – very good – income every quarter from them.
#3: Invest in Growth Stocks.
While dividend stocks are safe, growth stocks are exciting. A good example of a growth stock is Amazon. If you had invested $1000 in Amazon stock in 1997, your investment would have grown by 496 times by 2018 and be worth $496,000 as of today! Not all growth stocks are going to be like Amazon. 7 out of 10 will fail, and 2 out of 10 will be nothing more than average. But even if you have got one single hit, that will set you up for life.
Follow this simple advice for growing your wealth into something really substantial in the near future.