The most balanced casual investors should look at building a portfolio with both real estate and shares in it. The wealthiest investors, like the great Warren Buffet, may be happier to take risks by betting all of their cash on one asset. For the average investor, however, who has far less cash to play with, spreading out your money will cushion you against any dips in one asset class.
But let’s say you only want to invest in one asset class to get yourself started. Which is best - property or shares? Let’s take a look at the pros and cons of each.
Property is a solid investment and one that is relatively simple for most people. You don’t need to navigate the complex stock market and your solicitor will simplify any jargon you do come up against. However, that’s not to say there are no drawbacks to investing in property.
There are lots of great reasons to invest in property - here are just a few:
While real estate is a great option, it’s unrealistic to say there are no drawbacks to investing.
Stocks and shares give you the option to invest in a wide range of sectors and across countries. You could grab a piece of some of the world’s most successful companies, or support young, exciting enterprises on their way to the top. However, most people are pretty unfamiliar with the process of investing in stock markets, since they can be a little confusing to navigate.
Here are just some of the best bits about investing in shares:
There are a number of things that could work against you when it comes to stocks and shares:
Balancing your portfolio is the best bet for investors who are more risk-averse. While no investment is ever guaranteed, dipping your toe into a number of asset classes, including property, stocks, bonds and more will give you a better chance of achieving your financial goals.
Let’s say, for example, that you bet all of your cash on one company. While it may appear that you’ve struck gold at first, cautionary tales like that of doomed biotech company Theranos show just how dramatically investments can go south. However, with the buffer of a property investment behind you, your loss could be cushioned by your rental income or house price appreciation.
Looking for a way to add real estate to your investment portfolio for as little as $1,000? Bricksave lets you do just that. You can crowdfund attractive properties in desirable locations across the world, including the US, without the hassle or expense of purchasing one outright. You’ll also enjoy a share of rental income and potentially get an impressive return on your investment if the property appreciates in value.
Find out more about how to start investing in real estate with Bricksave.
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