Investors are creatures of habit and most are accustomed to making money from their investments – and the more money they make, the happier they are. Fortunately, investors have plenty of choices when it comes to making money, so when one market heads south, they simply shift their investing strategy to an investment that will make them the most money and life goes on.
But how do you make money when all the markets tank at the same time?
Investors are finding out that many of the faithful investment opportunities they’ve relied on for strong, consistent growth have turned on them. Here are just a few of the investment choices you have to choose from – and your prospects for making money in a down market:
• Stock Market – From Individual Retirement Accounts to 401K retirement plans, mutual funds, and day trading, millions of Americans have pinned their financial futures to the performance to the stock market. Until recently it seemed like a good bed for rapid equity appreciation. The market was headed straight up and life was good. Then the bottom fell out and these investors discovered the stock market’s dirty little secret: You can lose your shirt in just a few disastrous trading sessions. It doesn’t matter how many shares you own or how undervalued you believe your stock to be. You’re betting on the value of paper going up consistently over time. Short term volatility is the word of the day and – depending on when you get into the market – you could lose money for a very long time. For instance, there was almost no growth in the market from the 1960s to the 1980s, and in a lot of cases, you would have seen better growth by putting your money in a passbook savings account and watching it grow one penny at a time.
• FOREX trading – Another choice that has gained in popularity during the past few years is currency trading. In case you’re not familiar with currency trading, the value of the dollar fluctuates on a daily basis with other currencies of the world. If you successfully place your bets and buy at the right time – or hedge your bets and gamble that a foreign currency will gain or lose value compared to the dollar – you stand to make a ton of money fast. Unfortunately, the biggest winners are very good at what they do and they best in the business lose nearly as much as they win. Unless you have immaculate timing you can be yet another one of the casualties of FOREX trading.
• Starting a Business or franchising – When the market is bad, some investors decide to start a business of their own or buy into a franchise opportunity thinking that name recognition will guarantee their success. Unfortunately, franchises will charge you up to $50,000-$100,000 for the privilege of putting up a sign. Then you have to invest in a building, inventory, hire employees, and hope against hope that you’ve chosen the right franchise in the right location at the right time. If you do everything right, you’ve won the right to stay in business and manage a time-intensive facility that has to adhere to corporate rules, purchasing requirements, etc. – with no guarantee that you’ll even be able to turn a profit. And that’s assuming you can even get in. Most franchise opportunities will require that you have sterling credit. If it’s not, you could be out in the cold.
• MLM – Americans have an affinity for buying magic potions, lotions, and pills in the hopes that what ails them can be cured overnight. Some investors decide to take a whirl at making money with one of these schemes only to discover the truth: While you can make money in MLM, most don’t. And by getting involved in MLM an awful lot of investors discover that there are minimum purchases required, many MLM opportunities push you to sell to your friends, family, or anyone you have even a passing acquaintance with, and your “guaranteed” riches can disappear in the blink of an eye if the company goes under or someone in your “upline” quits or fails to make it.
These investments can be more than a little scary, so a lot of would-be investors turn to real estate for solid growth opportunities and the hope for a more profitable future. Even in a terrible market, you can make money in real estate investing. That’s a tremendous draw for a real estate investor, because most other opportunities are losing money right now – with little chance for turning a profit.
By investing smart, you can reduce much of the risk that real estate can pose. While all investments come with a certain amount of risk – and uneducated investors manage to lose money every day – you have much more control over your destiny. This is true even in a down market.
And real estate investing makes it possible to turn a profit at every turn – when you buy, if you hold, and again when you sell. In addition, if your investment doesn’t perform the way you had hoped when you made your initial investment, you can make money by exercising good judgment and dumping the property on the open market.
The investment choices I listed above aren’t necessarily bad choices even in a bad market. But they do have a lot of limitations that can inhibit your ability to be profitable.
Probably the best reason for pulling the trigger today on real estate investing is the fact that you’re in control every step of the way. Instead of taking your chances and hoping for the best, go with an investment that lets you decide how, when, and where to invest. You don’t have to have perfect credit to play the game and the more you play the better you’ll get.
So turn the corner today and start reaching for your financial goals. Real estate investing is the vehicle you’ll use to reach your financial destiny. So get in, buckle up, and hang on. Your best bet for making money in a bad market is not to gamble. Put your money on a sure winner. Real estate investing has created more millionaires with less risk than any other investment out there.
Will you be the next one?
Charrissa Cawley is the founder of [http://www.reiconferen