6 Income Producing Assets to Invest In

Most people dream of building a nest egg for themselves for the future. You might want to get to a point in your life where you don’t have to worry about every bill and how you’ll pay it. 

Of course, the way to build wealth is to have a plan. It often isn’t as simple as socking money away in a savings account

Sure, that’s smart too. But you want your money to work for you to produce more income. So, what wealth management strategies do you need to follow to grow your money?

Whether you’re interested in having more income for your current lifestyle or building wealth for the future, follow these investing tips to produce more income producing assets for yourself. 

Income Producing Assets

What are Income Producing Assets?

Sure, when you go to work, you get a paycheck. But if you want to really build wealth, then you need to find some income producing assets.

Income producing assets are investments that generate income beyond the money invested in them. Often referred to as income generating investments, income producing assets can take many forms including stocks and bonds, rental income from real estate or dividend income from mutual funds.

Investing in income producing assets is a great way to supplement your income and build wealth over your lifetime. You could garner income from these investments for use on present expenses, or allow your investments to mature over time and increase in value for future use. 

Because of their ability to generate income over a long period of time with minimal effort, income producing assets are often an important part of an overall retirement strategy.

Below are 6 examples of income producing assets you can invest in today:

1. Money Market Accounts

You might already have a checking and savings account at your local bank. A money market account is similar to a bank savings account.

A money market account allows you to safely put large chunks of money away in an account, yet still have access to it if you need it. Some money market accounts allow you to write checks from them or the bank may even provide a debit card to use from the account. 

So, why choose a money market account over a regular savings account? Often a money market account will offer a little better interest rate for earnings.

Because they often restrict how many transactions you can process in a month, the money can mature and generate higher earnings.

Up to $250,000 is insured and protected by the Federal Deposit Insurance Corp. at banks and the National Credit Union Administration at credit unions.

2. Dividend-Paying Stocks 

Many people know about investing in stocks through the stock market. Stocks can earn money when the company grows in value. 

Most companies will have two types of stock for purchase: common and preferred.

If you purchase preferred stocks, which usually cost more, the company will give you some perks, such as a higher percentage of a dividend or you might be allowed to purchase stock options before a common stockholder. 

There are many companies that also pay regular dividends to their stockholders. Dividend-paying stocks tend to be safer options and they produce assets regularly.

3. Mutual Funds

There are many different kinds of mutual funds for investors to consider, giving you a plethora of options here. A mutual fund is when investors put money into the fund and pool their resources with other investors so the fund can buy stocks and other assets. 

Mutual funds are nice because you can invest money and cash out by simply selling your shares (in most cases). As the mutual fund invests in stocks and assets, the goal is that the funds grow to produce income for you. 

Many mutual funds allow you to invest with minimal amounts of money to get started.

4. Real Estate Investment Trust

A real estate investment trust or REIT is like a mutual fund except specifically for real estate. 

Maybe you want to invest in real estate but either don’t have enough funds to buy yourself or you don’t want the hassles of sole ownership.

A REIT takes money from many investors, pools that money, and invests in real estate that is income-producing. In return, the investors who put money into the REIT, share the income produced from the real estate. 

One issue with investing in real estate is that it isn’t a liquid asset. It does, however, offer capital appreciation. 

A REIT, on the other hand, is a truly liquid asset. You can sell your shares in the REIT like you would with a stock or a mutual fund. The trade-off to this liquidity is that you don’t get the capital appreciation that comes from owning real estate outright. 

5. Rental Property

If you want to actually own your own property, one asset producing idea is to purchase a home or apartment that you can rent out to someone else. 

It does require you to have the capital to buy the property, but once it’s rented it can produce a regular stream of income and serve to pay off a mortgage. 

This kind of income-producing asset is much less passive than some other options you might choose. It can certainly be lucrative if you get the right tenant in the property.

6. Storage Spaces

A little different type of real estate investment is to invest in self-storage units. The industry is exploding across the country.  Every town has self-storage units where people can rent a space, big or small, to store belongings for a monthly fee. 

It’s very passive real estate investing because typically the self-storage facility requires minimal maintenance and upkeep and produces a regular revenue stream. 

Wealth Management Ideas to Build Your Personal Wealth

If you’re looking for wealth management advice, we can help. Whether you’re in McClean, VA or Greater Houston, TX, we have financial advisors to help you find the right kind of investment for your needs. 

Contact us today to discuss which income producing asset is right for you.

Please remember that past performance is no guarantee of future results. Different types of investments involve varying degrees of risk, and there can be no assurance that the future performance of any specific investment, investment strategy, or product (including the investments and/or investment strategies recommended or undertaken by Bogart Wealth, LLC [“Bogart Wealth”]), or any non-investment related content, made reference to directly or indirectly in this blog will be profitable, equal any corresponding indicated historical performance level (s), be suitable for your portfolio or individual situation, or prove successful. Due to various factors, including changing market conditions and/or applicable laws, the content may no longer be reflective of current opinions or positions. Moreover, you should not assume that any discussion or information contained in this blog serves as the receipt of, or as a substitute for, personalized investment advice from Bogart Wealth. To the extent that a reader has any questions regarding the applicability of any specific issue discussed above to his/her individual situation, he/she is encouraged to consult with the professional advisor of his/her choosing. Bogart Wealth is neither a law firm nor a certified public accounting firm and no portion of the blog content should be construed as legal or accounting advice. A copy of the Bogart Wealth’s current written disclosure Brochure discussing our advisory services and fees is available for review upon request or at bogartwealth.com

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