Where to invest money for passive income
In our difficult times, there are still people who have been able to accumulate some savings and they are faced with a particularly pressing question - where to invest money for passive income.
After all, no one needs to be convinced that unused capital is melting away before our eyes; over ten years, inflation even for the US dollar was about 30%.
That is, if you kept your money in US dollars, you have already lost a third of your savings in just ten years.
You can analyze possible investment options for a long time, comparing their profitability, but it is best to study this issue using a specific example.
So, where is it profitable to invest money for passive income?
For an objective assessment of the profit received, all calculations will be given in American dollars.
Real estate in Ukraine - an apartment in a new building, purchased during the construction phase at a price of 400 dollars per 1 square meter, now costs more than 600 US dollars per 1 meter. That is, we can say that the invested money brought 50% or 10% per annum.
The price increase was due to the commissioning of the house and the general increase in prices on the real estate market in the western regions of Ukraine.
Real estate abroad - an apartment purchased in Poland at a cost of $1,260 per square meter has now risen in price to $2,000 or 59% over 5 years, which equals 11.8% per annum.
Such a high result became possible due to a sharp rise in prices in Poland and due to the low exchange rate of the US dollar at the moment. Real estate prices in this country are not so tied to the US dollar, so they can vary significantly depending on the dollar/zloty exchange rate. Therefore, it is more profitable to buy real estate in Poland when the dollar exchange rate is high, and to sell when the dollar exchange rate is low.
Gold bars - around the same time, a small bar of bank gold was purchased at a price of $42 1 gram.
You can currently sell the purchased bullion at a price of about $60 per gram, the profit would be 43% or about 8.6% per annum.
Interest on deposits in hryvnia showed an almost negative result due to the depreciation of the hryvnia against the US dollar. Over five years, about 45% was accrued, but the hryvnia exchange rate fell by 40%, so the profit will be less than 5% in 5 years.
Deposits in foreign banks are even ridiculous to count, since the dollar rate is 1-1.25% per annum, which does not even cover inflation.
Deposits with brokers earned slightly more interest , which are accrued on account balances. Without going into details, we can say that the average amount of interest accrued here was about 9% per annum, 45% for 5 years.
There were also investments in cryptocurrencies, but this asset was sold earlier and with varying success, so it is impossible to objectively assess the real profit from investing money in cryptocurrencies .
Taking into account the experience gained and answering the question - where to invest money for passive income? Right now I would choose the following options:
- Investments in gold, since in the coming years it is expected that the price of this metal will continue to rise. But instead of gold bars, I would open a transaction on the stock exchange with one of the brokers , due to the fact that doing this is now much easier than buying bars.
- Real estate abroad - but this time I would buy small properties, apartments with an area of 30-40 square meters or space in underground garages. Since this property has risen in price by much more than 59%. And it’s much easier to sell or rent out a small apartment.
In general, we can conclude that it is quite difficult to get more than 10% per annum from passive investments if these investments do not have a high risk. It is clear that there are more profitable options, for example, the same PAMM accounts , but there you can not only not make a profit, but also lose your money.