No one has a secret formula to help you make more money in investing.
However, there is an investing strategy that can help you earn money.
It’s called: long-term investing.
In fact, long-term investing radically increases your chances of earning higher returns.
If you had invested your money between January 1971 and May 2020, you would see the following chances of making a profit:
|Amount of Time Invested||Chance of Making a Profit|
As you can see, the more time you spend invested in the stock market, the higher the chances that you will see a profit.
This is the point where you’ll need to be:
- Focused on the long-term
Ultimately, whether you’re successful in the stock market depends on the following:
If you’re ready to learn more about the best long-term investments and how you can make money over the long run, keep reading.
Sneak Peek: Top 3 Long-Term Investments
The Stock Market 👇
Fine Art 👇
Real Estate 👇
One way to make money is to focus on the bigger picture.
Long-term thinking can help you avoid making rash (and emotional) decisions that often come in the heat of the moment.
That’s why long-term investing is typically a proven strategy.
Before we dive into the best long-term investments for beginners, let’s first take a look at the long-term investment definition.
13 Best Long-Term Investments
Not all index funds are created equal, however.
Specifically, there are different index funds for different purposes, as I’ll illustrate below:
500 best American companies (stable, long-term growth)
Top 3000 publicly traded companies in the U.S. Accounts for about 98% of all U.S. stocks
2000 smaller companies (which are all included in the Russell 3000)
MSCI Emerging Markets
Large and middle-sized companies from 27 emerging nations
In total, there are about 5,000 different types of indices in just the U.S. alone.
Here’s why it’s typically a good long-term investment to put your money into an index fund – like the S&P 500 for example:
- Low risk
- Low fees
- Steady growth
Let’s take a closer look at the performance of the S&P 500 index fund (my favorite, if you haven’t noticed already) over the past roughly 100 years:
This chart illustrates the return of a $100 investment from 1926 (the inception of the S&P 500) to 2021.
Over this timeframe, $100 would have grown at a 10.22% per year – which would mean your $100 in 1926 would now be worth a staggering $1,034,433.90 in 2021!!
Talk about one of the best long-term investments.
The S&P 500, which is one of the oldest indices, started in 1926 and has experienced many ups and downs over the past several decades.
However, there is a strong positive trend – if you are a long-term investor.
|Year Invested||Your Return|
Of course, that doesn’t mean you should expect a 1,000% or more return every year.
And that’s why one of the best long-term investments is investing in low-cost index funds.
One of the easiest ways is to start investing with apps like Acorns or M1 Finance.
The investing app Acorns can be a perfect fit for beginner investors who don’t yet have $100’s or $1,000’s to start.
It took me about 5 minutes to set up my Acorns account.
All it takes is $5 to start investing – not $1,000’s.
If you’re a little savvier with investing and can afford to invest several $100 or $1,000’s, then you may want to check out the investing app M1 Finance.
M1 Finance is super easy to set up, the interface is intuitive and although M1 Finance creates an investment portfolio for your needs (they call this “the pie”), you still have space to customize your investments.
You’ll need about $100 to start investing if you’re opening an individual account and you’ll need $500 to start, if you’re opening an IRA.
Guys and gals, if you haven’t yet, start investing now.
Your bank accounts will thank me later.
2. Your Education
There is no way that you can go wrong by investing in yourself.
In fact, I would almost argue that investing in yourself is the best long-term investment out of all these options.
I’m not necessarily saying to pack up your bags, take out a $300,000 student loan and go to college in an effort to invest in yourself.
But what I am saying is that next time you have the following options:
|Option 1||Option 2|
$50 pizza night
$50 training course
…You have the power to decide what you consume.
The same also is true if you consume poor quality.
I’ve listed some ways below that detail how you can invest in yourself for minimum cost but maximum outcome:
- Your family
- Your health
- A life coach
- Your network
- An online course
…And the list goes on.
The good news is that you can start investing in yourself today.
If you are a beginner and are looking to transform your mindset, your life, your future, your potential, you may want to start by reading my latest book, How to Get Rich From Nothing.
Getting rich doesn’t just refer to money.
Getting rich also refers to the following:
- Growing mentally
- Growing your network
- Growing your confidence
- Growing your financial literacy
- Growing your financial competence
Dare to invest in yourself.
Remember that the quality of your thoughts is determined by the quality of your life.
If you’re already invested in the stock market (and are fed up about hearing how you should invest in stocks), then you may want to consider using your money for another, more volatile long-term investment.
This time, I’m talking about cryptocurrency.
Probably the most common names in crypto are either Bitcoin or Ether (aka Ethereum).
Believe it or not, crypto has become arguably one of the best long-term investments – specifically if you’re not afraid of volatility.
Take a look at the historical astronomical returns of Bitcoin:
Although the returns for Bitcoin have been staggering, it should be noted that Bitcoin – and cryptocurrency in general – is extremely volatile (as demonstrated by the chart above).
Yet, the returns continue to amaze me:
|Year||Bitcoin Annual Return|
Here’s a way to put these numbers in perspective:
|Bitcoin vs. S&P 500|
Mean Annual Bitcoin Return
Mean Annual S&P 500 Return
The demand for cryptocurrencies spiked drastically in 2020 and 2021, especially as the COVID-19 pandemic hit.
If you’re looking to invest in cryptocurrency as well, you may want to consider opening a free Coinbase account.
Coinbase is one of the top 3 largest crypto exchanges in the world, and offers 30+ coins for investing – plus it takes about 5 minutes to set up your account.
Cryptocurrency is likely one of the most volatile yet best long-term investments with the highest return potential.
However, I would only suggest you consider investing in cryptocurrency if you’re:
- Comfortable with volatility
- Comfortable with cryptocurrency
- Debt-free (specifically high-interest debt)
Even if you are keen on investing in crypto, I would suggest only investing as much as you are willing to lose because crypto is highly volatile.
Undoubtedly, stocks are one of the best long-term investments because stocks can yield a high return on your investment.
As they say, “no pain, no gain.”
However, the real reason why people (like me) invest in stocks, is because we believe that the stock value will increase over time.
And, this is not a wrong theory.
In fact, even over just the past 40 years, the stock market has made positive returns.
That’s right… stocks can be an incredible investment.
That volatile behavior simply comes with the territory.
For that exact reason – that stocks are volatile over the short term but typically yield positive growth over the long-term – is why you should be considering stocks as a long-term investment.
If you zoom out and look at the bigger picture (we’re talking 30 to 50 years from now), a tiny drop in the stock market today will not make a significant difference in your portfolio.
And that’s why professionals have recommended the “buy and hold” long-term investment strategy.
Based on historical data, investors who stay invested – regardless of stock market ups or downs – are much more likely to earn positive returns over long periods of time.
If you want to try your hand at investing in the stock market, I’d suggest considering the investing app Acorns.
If you’re a little more advanced (and can afford to invest several $100 dollars), then the investing app M1 Finance is another great option.
Keep in mind that not all stocks are created equal.
There are different types of stocks, which I’ll talk about below:
|Type of Stock||What it Does|
Focused on long-term growth, with minimal to no dividend payouts
Focused on returning company profits to shareholders in the form of dividends
Large Cap Stock
Companies with a market value between $10 billion to $200 billion
Mid Cap Stock
Companies with a market value between $2 billion to $10 billion
Small Cap Stock
Companies with a market value between $300 million to $2 billion
Company with a low price relative to the company’s financial performance
The type of stock you invest in really depends on your comfort level with risk.
If you’re OK taking some risk, then you may want to consider:
- Growth stocks
- Mid-cap stocks
- Small-cap stocks
On the other hand, if you’re more comfortable with stable and steady returns over time, then you may want to consider the following:
- Value stocks
- Dividend stocks
- Large-cap stocks
The key message here is this: Invest early. Invest consistently.
5. Passive Real Estate Investing
Real estate is probably one of the best long-term investments.
If you want to join the high roller real estate club but don’t want to do any of the physical work (like finding new tenants, dealing with tenant disputes, etc.), then there are other options!
The best place to invest money right now for passive real estate investing includes:
- Real estate crowdfunding
- Real estate investment trusts (aka REITs)
I’ve defined these 2 words in plain English below 👇
|Real Estate Crowdfunding||Real Estate Investment Trusts (REITs)|
You (the investor) can select which real estate investment you want to participate in
You can invest in real estate through REITs much like you can invest in stocks
One reason why I think passive real estate investing is one of the best long-term investments is because you get to have a slice of the real estate pie – without doing any of the hard work (aka dealing with tenants!).
I like REITs because it’s just like investing in stocks and REITs offer a pretty high return on your investment.
In fact, as of March 2019, REITs have seen an average annual return of 10.50%.
In comparison, the S&P 500 Index (which tracks the 500 largest U.S. companies), has seen an average annual return of just about 9.8% over the past 20 years.
If you want to enjoy high returns and put your money in one of the best long-term investments, then you should consider an online real estate investing platform like Fundrise.
Fundrise allows investors (like you) to start investing in real estate with as little as $10 (most of the time, it’s more like a minimum $5,000 investment).
Fundrise invests in the following types of real estate:
- Apartment complexes
- Multi-family real estate
- Luxury homes in southern California, Texas, and North Carolina
Below is a little more information on Fundrise:
8.76% to 12.42%
Illiquid and long-term investment
6. Tax-Sheltered Retirement Plan
Who likes paying taxes? Probably no one.
Thanks to the IRS (yes, the IRS), there is a way to not pay taxes – legally!
And that’s called a tax-sheltered retirement plan.
You’re probably familiar with several common tax-sheltered retirement plans, such as:
- Roth IRA’s
- Traditional IRA’s
- Health Savings Accounts
Honestly, the list keeps going.
Here’s my point:
If you correctly implement a tax-sheltered retirement plan into your long-term investing strategy, you can save money.
Lots of it.
Below are some general benefits – and tax savings – you’ll see with tax-advantaged retirement plans:
- Tax-free withdrawals
- Tax deferral on earnings
- Tax deductibility of a contribution
I’ve also listed some examples of the retirement accounts that could offer you the tax benefits above:
|Tax Benefit*||Account Type|
- Roth IRA
Tax deferral on earnings
All tax-advantaged accounts
Tax deductibility of contributions
- SEP IRA
*These tax benefits assume that you follow the rules as prescribed by the IRS and your individual retirement plan. For the purpose of this article, I will not go into further detail about the rules that must be followed to enjoy the tax benefits mentioned above.
As of August 2021, the Secure Act 2.0 has received bipartisan support and is expected to pass.
The Bottom Line:
It’s important to take advantage of your tax-sheltered retirement plans from an early age so that you can allow your money to grow for decades without being taxed.
The earlier you start, the better off you’ll be.
If you haven’t opened a tax-advantaged investment account just yet, then you may want to start by using Acorns (you can start investing with just $5) or by using M1 Finance (which requires a minimum of $500 for all retirement accounts).
If you have a 401k, 403b, 401a, or 457 plan, keep reading.
I encourage you to at minimum invest in your employer-sponsored retirement plan (aka 401k) to get the employer matching contribution.
An employer match is basically free money.
But your 401(k) money won’t grow if you don’t invest.
And if you aren’t comfortable managing your own investments, then that’s where the 401k robo-advisor Blooom (yes, those are 3 o’s!) comes into play!
Blooom is a robo-advisor platform that you link with your 401k (for instance) and Blooom will manage only your investments for about $10 per month (which is cheap).
Blooom will optimize and manage your 401k investments for you, so you can focus on the things that really matter (aka not managing investments).
Remember that tax-deferred growth can be your friend.
Start investing today.
7. Active Real Estate Investing
If you’re someone who is serious about real estate investing, you may want to consider buying a physical property and renting it out.
Now, there are many pros and cons to buying an actual home and renting it out.
Arguably, this real estate investment option is one of the riskiest but likely also one of the most rewarding, especially if you can occupy your home with reliable, rent-paying tenants.
That’s where the platform Roofstock comes into play – and can make your life a whole lot easier 👇
With Roofstock you can buy a home (yes, an actual house) that already has tenants living inside the home.
Why is this pretty revolutionary?
That’s because the second you finish signing the paperwork for the home, you’ll start receiving a monthly income stream (in the form of rent) from the tenants living in the house – so you don’t have to find tenants!
The tenants are previously vetted by Roofstock’s property management companies.
If you do decide to buy a home through Roofstock, the overarching recommendation is to still hire a property management company (and Roofstock typically offers recommendations) to help you with the rental process.
Actively renting out real estate can be another beast.
But, as far as long-term investments go, active real estate investing could be a great option to not only earn passive income but also diversify your portfolio into real estate.
8. A Side Hustle
One of the absolute best long-term investments is investing in a side hustle.
In fact, about 57% of Americans have a side hustle today.
Especially during COVID-19, and people having to go through job layoffs, the popularity (and quite honestly the necessity) of having a side hustle spiked.
That’s what COVID-19 taught us.
According to this article, since the pandemic started in early 2020, over 2 million Americans have started building a side hustle for themselves to help provide additional monthly income.
Let’s face it, the ever-increasing cost of living isn’t exactly helping us, either.
That’s why 27% of side hustlers rely on their side hustle income to cover basic monthly bills.
That being said, if you start a side hustle, chances are that you probably won’t be earning $1,000’s extra every month.
That just takes time (and consistency).
However, there are some side hustles (which I’ll talk about below) that can seriously boost your monthly income – and we’re talking by $10,000’s.
Below are the top side hustles – and you should consider putting your time, money, and energy toward these, since they’re some of the best long-term investments for beginners:
As you can see, the list goes on and on.
There are so many ways you can earn money – fast.
I’ve been fortunate enough where I learned how to monetize and start earning money through my Twitter account!
In today’s virtual world, there are no more excuses.
If you want to earn money, you can do it – thanks to modern technology.
Yes, you’ll probably have to invest money into your side hustle business but if you’re consistent and patient with your efforts, chances are that you’ll see high returns.
Do it today.
You’ll thank me later.
9. Robo Advisors
Another long-term investment is using a robo-advisor to manage your investments.
If you’re new to the investing world and don’t feel 100% comfortable investing by yourself, then you should consider using a robo-advisor platform.
From there, you let the robo-advisor manage your money – while you decide when to add more money to the platform or when to withdraw money.
Below are some typical tasks the robo-advisor would do for you:
- Choose your funds
- Prepare a portfolio
- Rebalance your account
Although there are many robo-advisor options to choose from, below is a list of popular robo-advisors and for whom the apps may be most suited:
My favorite app – for those who are serious about long-term investing and who are able to invest a lot of cash – is M1 Finance.
That translates to around $25 to $50 for every $10,000 you invest per year.
Here’s what I love about robo-advisors:
They work 24/7, every day – and you can always make adjustments when necessary.
That means you have unrestricted access (unlike human beings).
The way your robo-advisor manages your account (aka how much stock exposure you have) largely depends on your risk tolerance:
- If you like risk, you’ll have more stock exposure
- If you don’t like risk, you’ll have more bond exposure
- If you need money in the near future, you’ll have more cash exposure
If you want to build long-term wealth, you should consider joining a robo-advisor platform.
10. Fine Art
Have you ever wondered what it would be like to invest in fine art?
Typically, investing in luxury art is a pastime activity for the exclusive world of the ultra-high net worth people of this world.
Enter, Masterworks 👇
Masterworks is a new art investing platform that gives the average Joe the chance to invest in fine art, worth up to $30+ million.
How can you invest in million-dollar artwork?
By buying fractional shares of art.
So while you might not physically own the full artwork itself, you are invested in an appreciating and long-term investment.
In fact, with Masterworks, you could invest in popular artists such as:
- Jean-Michel Basquiat
In the screenshot above, you can see just some of the incredible artists that are featured through Masterworks – and the value of their paintings.
The price of fine art investing has increased significantly over the past several years – to the point where the fine art index has consistently outperformed the S&P 500 index.
While you can make some serious money if you invest in fine art with Masterworks, there are some drawbacks that you might want to consider as well, including:
- High costs and fees
- Long lock-up periods
- Fine art is an unregulated industry
And I can’t stress enough that you should always do your research first before financially committing.
Check out my Masterworks review to find out more about how you can start investing in fine art today.
Have you ever wondered what it would be like to invest in farmland?
Maybe you didn’t pursue your thoughts because:
- It can be demanding
- It can take a lot of work
- Investing in farmland can be expensive
Thanks to modern Fintech, you can now invest in farmland, earn passive income, and not have to work long hours to care for the land.
With the platform, AcreTrader 👇
AcreTrader is a real estate crowdfunding platform for accredited investors where more people are given the chance to invest in real estate – specifically farmland.
The best part?
You don’t have to do the hard work that comes with farming.
In fact, did you know that the average value of farmland in America has increased by about 6% per year?
So clearly there is some money to be made with farmland – especially in the long run.
With AcreTrader, as long as you are an accredited investor (which means you must have a higher income, typically $200,000+ per year or a $1 million net worth), you can invest in farms across the country.
Take a look at some of the farms below:
Here are some of the benefits of investing in farmland:
- Low volatility
- Protection against inflation
- You diversify your portfolio
- You can earn passive income
- The value of farmland keeps increasing
Take a look at the returns of farmland over the past 30 years:
Farmland is the second-highest returning asset class, behind REITs (real estate investment trusts).
Now take a closer look.
Farmland is also the most stable returning asset class: The value of farmland just keeps increasing without experiencing the ups and downs that REITs tend to experience.
And depending on the individual deal you’re investing in, some additional cons that you might face include:
- High fees
- High minimums
- Fee structure could be complex
- Money may be locked up for a long time before seeing returns
However, there clearly is an increasing demand for farmland, so this could be the right long-term investment for you.
Recommended Reading: AcreTrader Review
12. Fine Wine
Are you a wine enthusiast?
If yes, then I might have the perfect long-term investment for you:
Investing in fine wine through Vinovest 👇
Vinovest (pronounced veeno-vest) is the world’s first AI-generated fine wine robo advisor.
With Vinovest, you will have the option to:
- Invest in fine wine
- Diversify your portfolio
- Earn up to 13%+ in returns
- Protect yourself against inflation
- Protect yourself against stock market volatility
Vinovest was founded in 2019, and since its inception has attracted over 1.15 million users to its website.
And that’s for good reason since fine wine has proven to be a lucrative investment, consistently outperforming the S&P 500 index over the past roughly 20 years.
The chart above is vastly zoomed out to show you the difference between fine wine returns (in pink) versus the S&P 500 returns (in brown).
Take a look at the difference in performance in the year 2012:
- Fine wine returns: 2,020%
- S&P 500 returns: 490%
So, if you’re already invested in the stock market and are looking to diversify your portfolio, then fine wine might be the right next move for you.
With Vinovest, first, open a Vinovest account (it’s free) and answer a short risk tolerance questionnaire, which asks you some questions to gauge which fine wine investment could be best for you.
Next, add your funds, which can be done by:
- Using a credit card
- Linking your bank account
- Transferring cryptocurrency
Then, you’ll wait for Vinovest to buy fine wine for you.
It’s typically recommended to hold on to your fine wine for about 10 to 15 years before you sell it (or drink it yourself, which you can do!).
With Vinovest, you can invest in wines ranging from across the globe, such as:
Depending on the fine wine that you invest in, you could see over 100% + returns.
In fact, did you know that the most expensive wine bottle ever sold was for $500,000?
It was a bottle of 1992 Screaming Eagle Cabernet.
While you can certainly make a lot of money in fine wines, just remember that fees can be high and that lock-up periods tend to be very long (10+ years).
Always do your research first before financially committing.
Recommended Reading: Vinovest Review
13. Small Businesses
Have you ever wanted to invest in the local businesses in your community, but didn’t exactly know how (or where) to start?
Now you can with one of the best (and free) small business investment platforms.
Enter Mainvest 👇
Mainvest is a new regulating crowdfunding platform that gives the average Joe the chance to invest in local, brick-and-mortar business startups for as little as $100.
Did you know that you can earn a return between 15% to 30% just by investing in small businesses?
Compare those returns to what you can expect from an investment in the S&P 500, which yields about 7% to 10% per year.
With Mainvest, you can create your account (for free) and search for local businesses that you’re interested in investing in.
Below is a list of some businesses:
Note that Mainvest does not offer businesses like:
- Tech firms
- Mobile apps
- Software companies
This is because one of Mainvest’s major philosophies is to invest in the local community and invest in “Main Street” (hence the name, Mainvest), so their goal – at least for now – is to stick with investing in physical businesses.
The main type of investment you can pursue on Mainvest is:
- Debt investment
Depending on your particular investor contract with the business, you might even earn up to 4X of your initial investment – but that’s typically negotiated in the terms of the contract itself.
Mainvest earns its money by charging fees to the businesses that are on its platform.
Personally speaking, I’m a big fan of the Mainvest platform, and for just $100, I’d say that this is one of the best long-term investment opportunities to consider pursuing.
Recommended Reading: Mainvest Review
Best Long-Term Investment Strategies
It might be counterintuitive that one of the best long-term investment strategies is doing nothing.
That’s where you have to put your faith into the markets and the economy – and simply ride out the ups and downs.
If you want to make a profit, then market volatility is simply part of the game.
There are some additional items that you’ll want to consider with long-term investments:
- The amount of risk that you’re willing to take
- The length of time you plan to stay invested for
- The ability for you to handle short-term volatility
In the end, it doesn’t matter if the markets drop by 10% or even by 40% tomorrow.
Because with long-term investing, a market drop is simply a blip on the timeline – it very likely will not impact your long-term returns.
Take a look at the picture below:
Initially, you’d probably think the market is super volatile.
If you notice the time metric (on the horizontal line), that’s because you’re only given a snapshot of five day’s performance in the market.
Now, if you take some time to zoom out (aka long-term investing) and look at the market’s performance over the last several years, you’d see a different picture:
If you look at the bigger picture, you wouldn’t even notice the mini ups and downs that the market experienced in just 1 day (from picture 1).
Instead, you’d notice that the market is at all-time highs.
The Bottom Line:
Long-term investing helps you take a step away from the daily market ups and downs. Instead, long-term investing focuses on the bigger picture instead of the day-to-day market performance. Trust me, your anxiety will thank you later.
FAQs on Long-Term Investing
Some safe investments with high returns include:
- Index Funds
- Corporate bond funds
- Certificates of Deposit
- Real estate crowdfunding
- High yield savings accounts
- Real estate investment trusts
- Short term government bond funds
Just keep in mind that the terms “safe” and “high returns” are practically oxymorons.
In other words, without taking some type of risk, it’s really hard to earn high returns – that’s just the nature of the game.
So, don’t expect to earn returns equivalent to the stock market (between 7% to 10%) if you’re “just” making a cash investment (which is safe) in products like high-yield savings accounts or CD’s.
You could probably expect only around a 0.50% or 2% max return.
Some best long-term investments include:
- Real estate
- Index funds
- Your education
- Tax-sheltered retirement accounts
It’s important to remember that long-term investment options should stay “out of sight, out of mind.”
You’re better off leaving these long-term investments alone.
Come back to the investments in a few decades, and you’ll likely see substantial gains.
The trick is being patient.
The types of long term investments with the best returns include:
- Real estate
- Index funds
- Growth stocks
- Your education
- High dividend stocks
Keep in mind that to earn a high return with long-term investment strategies, you probably need to a little more risk.
If you don’t take any risk (aka you keep everything in cash), you probably won’t see good returns.
Now, it’s a question of whether you’re able to sleep at night knowing that the stock market will likely go through several 20% or more drops in your lifetime.
The best investment for 10 years mainly depends on your ability to handle market volatility. If you’re comfortable leaving your money in risky investments, meaning you’ll see high returns, then you may want to consider cryptocurrency, real estate, and growth stocks. The trick is to stay invested for 10 years and not sell during market instability.
Understanding which long-term investment strategies are best for you and your situation can help build the foundation for your financial future.
In other words, you’ll have to understand that long-term investing means:
- You can’t day trade
- You can’t follow the market performance on a daily basis
- You can’t check long-term investment returns every second
Long-term investing means just that: You’re investing for the next several decades.
So, don’t let a single day’s negative performance (or even a single year’s negative performance) impact your will and desire to stay in the market.
Focus on the bigger picture, instead.
Thanks to modern technology, robo-advisors like M1 Finance have made investing accessible and simple for beginners.
Ultimately, there are many long-term investment options.
Which is the best for you just depends on:
- Your personal situation
- How much you’re able to invest
- The amount of risk you’re willing to take
- The amount of time you’re willing to stay invested
Investing in stocks is likely a solid long-term investment option.
However, because no one has a crystal ball, one of the best long-term investments is to stay invested, regardless of what is happening today in the markets.
Your bank accounts will thank me later.
What is your favorite long-term investment? Let me know in the comments below.