A volatile stock market and crummy interest rates have forced a lot of people to get creative when it comes to investing their money. We’ve put together a list of six of the wackiest ways people are parking their cash.
A quick word of caution before you go crazy with these types of investments -- experts say that alternative investments as a group should constitute no more than about 5% to 15% of an overall portfolio.
On to the list...
Unusual Ways to Invest Money
1. Fine art
Buying and selling famous paintings has traditionally been the domain of the ultra-wealthy, but there are now ways that the average Joe can get in the game. Companies like Masterworks pool people’s money and purchase blue-chip artwork. They claim they can get you up to 10% or more on your investment per year.
Now we’re not saying you should withdraw your life savings and buy yourself a Monet, but for those of you looking for creative ways to beat the market, this might be a good option to consider.
Related: Masterworks Review
2. Music Royalties
Do you remember the Theme Song from the Monkees? Hey, hey, we’re the Monkees. That song still produces on average $10,000 a year in royalties and believe it or not, it’s possible to earn a piece of them by purchasing a share of the song at auction. Songwriters often sell a share of their royalties on websites like SongVest.com and Royalty Exchange and the auctions are open to anyone.
The Monkees’ Theme song is just one of several currently up for sale, and the shares start at $3,000. You continue receiving royalties on the song until the copyright ends, which is typically 95 years after the artist’s death (the Monkees’ song will produce royalties until 2099!).
3. eBay Land
eBay users might remember the “Virgin Mary” grilled cheese sandwich that sold for $24,000. But did you hear about the corner lot in the Mojave Desert that sold for $57?
Surprisingly, eBay has become home to a number of cheap land auctions like this. Most of the plots are probably cheap for a reason - there’s no demand and their location is unattractive. However, that hasn’t stopped some investors from scooping them up in hopes that they will one day be worth a bucket of cash. Maybe they’re betting that McDonald’s will need a Death Valley location one day.
4. Hurricane Options
One group of investors from watching the tropics very closely. Weather Risk Solutions has created an online trading market that allows traders to bet on where they think a hurricane might land. Traders buy and sell Hurricane Risk Landfall Options (or HuRLOs) that represent different regions of the Atlantic and Gulf coasts. If a hurricane hits land in the region that corresponds to the investor’s option, they split the payout with others who make the same winning bet.
The exchange is still in the beta stages, but the idea is attracting a wide range of investors, including weather enthusiasts, coastline businesses seeking extra insurance, and traders who are familiar with other disaster markets (flood options, etc.).
5. Tax Lien Certificates
A rough economy has left many homeowners unable to pay their property taxes and some investors are taking advantage by purchasing the county’s tax lien. This is possible because local governments, who don’t like to wait for outstanding tax bills, often sell their tax liens at auction where they are scooped up by savvy investors who like their high-interest rates and low risk.
In some states, tax lien certificates can be purchased for as little as $100 and the interest rates can range anywhere from 5% to 50%! Another advantage is that the annual interest penalty is often applied the day after the lien is acquired, so investors will earn an interest payment regardless of when the lien is paid back.
6. Bank Account Bonuses
While Bank of America is busy thinking up new fees to charge its customers, there are a few banks that are still paying large bonuses to new customers that open an account. Bank bonuses are one of the quickest ways to make money and can produce a significant return on your money in a short amount of time.
You can find an updated list of bank bonuses here.
Speaking of bonuses, if you want a bonus idea, find out how you can use an IRA to invest in cannabis.
Also read: Best Types of Low-Risk Investments
Do you have any other weird ways to invest your money? Let us know in the comments below!