6 Novel Investing Tools to Make Money and Make a Difference

6 Novel Investing Tools to Make Money and Make a Difference
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If you’re ready to start investing, you could go to a traditional brokerage firm and put money in a mutual fund. That’s a predictable and relatively safe way to watch your money grow. Predictable, and a bit boring.

For investment options with a bit more flair, head off the beaten path. There are several platforms that let you put your money into real estate, social causes or individuals with start-up businesses.

These investment options can reap substantial rewards, but they aren’t risk-free. Fortunately, we have all the details listed below so you can make an informed decision about using these services.

To do something different with your money, consider using one of the following novel investment tools:

Invest in real estate through Fundrise

Real estate is often touted as a good way to diversify investments, but it has traditionally been out of reach for many smaller investors. Fundrise has worked out a way to make real estate investing accessible to everyone.

You only need $500 to be a part of multimillion-dollar projects through this investing platform. That money then gets placed into eFunds and eREITs — basically, residential and commercial real estate portfolios that generally pay out dividends — as we detail in “How to Start Investing in Real Estate With as Little as $500.”

From 2014 to 2018, Fundrise investors had average annualized returns of 8.76%-12.42%.

The company generally charges a 1% annual fee and an upfront asset acquisition fee of 0%-2%.

Visit Fundrise’s website for more details.

Buy Worthy bonds

One low-risk way to make more on your savings than you can through a traditional savings account — and help build your community at the same time — is through Worthy bonds, which allows you to get started investing with as little as $10. A separate post explains all the details, but here’s the gist of it:

“You buy 36-month Worthy Bonds for just $10 each. Your money is loaned to small businesses through a peer-to-peer system, also known as P2P lending. Small-business owners using this system gain access to capital, and you earn 5% on your investment.”

Visit Worthy’s website to learn more or get started.

Invest through LendingClub

As another peer-to-peer lending platform, LendingClub is a way to make money while helping out families who need cash to consolidate their debt or make a major purchase.

Loans on LendingClub are rated from “A” for lower-risk investments with lower interest rates to “E” for higher risk and higher interest rates. Average historic returns range from 3% to 8% after service fees. You need to deposit $1,000 to open an account.

Visit LendingClub’s website to learn more about it or get started.

Invest through Prosper

Prosper is another peer-to-peer lending platform. If you invest here, your money isn’t going to buy shares in a corporation. Instead, your money is combined with that of other investors to provide personal loans to individuals who need to consolidate debt, buy a car or otherwise gain access to cash.

Investors on the platform get to choose which loans they fund. Prosper rates loans from “AA” for lower-risk, low-reward loans to “HR” for higher-risk, higher-reward lending opportunities. Historic returns on investments average 5.3% after fees.

You need to commit at least $25 to each loan you want to fund on Prosper.

Visit Prosper’s website to learn more or get started lending.

Invest in fine art through Masterworks

You don’t have to be a high-roller to invest in fine art anymore. A new company called Masterworks allows you to buy into the global art market with fractional investing — similar to the way you buy fractional shares in companies through stocks. No, you don’t get to hang the “Mona Lisa” in your living room. But you can get partial ownership in blue-chip artwork that has a history of appreciating steadily over time — and provide an alternative to the volatility of the stock market.

Remember, past performance of investments doesn’t predict future performance. And you should understand fees that apply (Part-Time Money has a good review of Masterworks here) to make sure you’re comfortable with this new and unusual wealth-generating opportunity.

Click here to learn more about Masterworks or get started investing.

Connect through Wealthramp

If you’re not ready to take the plunge using one of the investment platforms above, Wealthramp may be the right tool for you. It essentially serves as a matchmaker between investors and financial advisers.

You answer a few questions, and Wealthramp matches you to vetted independent advisers who fit your preferences. Users have the opportunity to review professional backgrounds and request an introduction with anyone who looks like a good fit.

Wealthramp only matches people to fiduciaries — professionals who are required to work in your best interests — so you can be sure you won’t be sent to a salesperson angling for a commission. There is no cost to investors to use Wealthramp.

Click here to learn more or get started.

Have you ever tried any of these platforms? Share your experience by commenting below or on our Facebook page.

Kari Huus contributed to this post.

Disclosure: The information you read here is always objective. However, we sometimes receive compensation when you click links within our stories.

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