New Year, New Investments: The Best Ways to Grow Your Wealth This Year

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Grow your Wealth this Year

Grow your Wealth this Year

The new year tends to be a prime time to reflect on your life, especially your financial situation after the massive holiday spending. It’s no surprise then that nearly 50% of people in the US are planning to make finance-related resolutions this new year.

The decisions you make now can set the tone for the rest of the year so making the right investments in the beginning can set you up for great returns by the end of the year and beyond.

The best part? You don’t need a hefty savings account to get started. From investing in music for $10 to building a long-term stock portfolio, here are the best investments you can make to improve your financial situation this year.

Seasonal stocks

No conversation about investments can be complete without discussing stocks. Whether you’re a seasoned investor or someone just dipping your toes in this world, stocks remain one of the most popular investment options as they can easily be adapted to your risk-return profile.

New investors can consider stable stocks that may not offer the biggest returns but tend to have consistent performance. On the other hand, veteran investors or those with a larger amount to experiment with might opt for riskier stocks with the potential for massive returns.

The timing matters too, experts say. If you’re investing around the holiday season (Christmas, New Year, Valentine’s, etc.), some companies might pay special dividends, says Taylor Kovar, a certified financial planner and CEO and founder of Kovar Wealth Management.

To further amplify the seasonal benefits, consider investing in retail and e-commerce stocks. “Holidays mean shopping sprees, so companies in retail or luxury goods usually get a nice bump in sales,” says Nathan Jacobs, researcher at The Money Mongers.

If you’re having a hard time analyzing and choosing the right stocks, well, you don’t have to. “If you’re not into picking individual stocks, consider funds that focus on holiday spending trends, Jacobs adds. “They mix things up with retail, e-commerce, and consumer goods stocks, giving you a slice of the whole holiday spending pie.”

Certificates of deposit (CDs)

CDs are a safe, long-term investment option. “If you do not need liquidity and can hold on to your funds longer, these time-bound deposits made with banks offer better interest rates,” says Bill Ryze, a chartered financial consultant at Fiona.

These usually require at least $500 to start investing, but offer a safer investment with guaranteed returns, which can be a wise choice during uncertain economic times, Kovar says.

Music royalties

If you’re looking to invest in something unique or deeply connected to your interests, consider music royalties. Apps like RIPE Capital make it easy to do this for as little as $10.

“Imagine having a share in iconic songs like Mariah Carey’s “All I Want For Christmas Is You,” which earned an impressive $2 million in 2020 alone,” says Sergey Golovkov, founder and CEO of the company. “With the continued growth of streaming platforms, these numbers have soared, making music royalties an enticing prospect.”

Music royalties can be both a short-term and long-term investment with the option to receive weekly payouts.

Finance education and coaching

It may sound cliché, but the best investment you can make is in yourself, says Robert R. Johnson, professor of finance at Heider College of Business, Creighton University.

He brings up the famous Warren Buffett quote: “Investing in yourself is the best thing you can do. Anything that improves your own talents, nobody can tax it or take it away from you.”

“Practically, this means acquiring more human capital or earning power,” Johnson adds. “One can do this formally by enrolling in education or certification programs or informally by reading and acquiring more knowledge and skills.”

The good news? This doesn’t have to cost you a fortune in today’s digital age. Many courses and books are available online for free or for a small price with student discounts.

At the end of the day, it all comes down to being intentional with your finances. Whether you enjoy buying fractional shares in your favorite songs or lock your funds in long-term deposits, the key is to make your money work for you, generating more wealth passively.

This article originally appeared on LifeUpswing and was syndicated by MediaFeed.

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