Smart Things to Do With Your Money | How and Why I Invest The Way I Do
Hey everyone! This post is going to discuss money - where I invest my money and why I choose those specific investments.
I follow a general investing philosophy practiced by many esteemed and wealthy investors such as Warren Buffet. The fundamental idea of this philosophy is to invest in assets that produce income streams over long periods of time.
Why Income Streams Rather than Asset Appreciation?
Many investors in the stock market, real estate market and crypto markets tend to look for assets that will appreciate in value over time. Meaning, they buy Stock X or Home X or Crypto X in hopes that they can sell it for more than they bought it for at a later date - it's your typical Buy Low, Sell High philosophy.
While I also subscribe to buying low and selling high, I take a much different approach with my investments. I prefer to invest in assets that will not only appreciate in value over time, but that also pay me an income while I'm holding them and waiting for the appreciation.
Warren Buffet gives a great analogy of income-producing assets by comparing farmland to gold. He begs the question, "What can you do with gold?" Versus "What can you do with farmland?"
The Answer:
- Gold is pretty to look at, but it doesn't offer any other type of value. It may increase in value over time, but it doesn't produce an income while you hold it.
- Farmland may or may not be pretty to look at, but it offers a reliable source of income and it can also appreciate in value over time.
I also apply this to a lot of various crypto investments. The majority of the money I invest in cryptocurrency goes towards cryptos that have some stream of income associated with them. Here's 3 of those coins that I invest most heavily into:
- STEEM
- ARK
- NEO
Of these 3, STEEM is by far my largest holding. STEEM can offer an incredible source of income to someone who's willing to post and engage in the community. ARK and NEO are both passive income streams - you earn your income based on how much ARK and NEO you stake in the network.
I also love STEEM because it has 2 major variables that determine how much income you make:
- How hard you work within the platform
- How much STEEM you stake in the platform
So, that covers my crypto passive income, but I figured I would take it a step further and show you all of the investments I make that provide me with passive income:
- Crypto (ARK, NEO, STEEM)
- Real Estate (rental income from a few properties)
- Dividend Growth Investing (investing in a selection of dividend paying stocks on the stock market)
- Loans (earning interest from loaning money to various loanees)
My next post will take a deeper look at the numbers behind these income streams and will talk more about how you can go about setting these up for yourself!
Here's the Question of The Day, don't forget to post your answers in the comments!
QOTD: What do you think about earning income versus just waiting and hoping for asset appreciation? Do you side with Warren Buffet or with the "buy low, sell high regardless of income" camp?
Thanks for reading! Don't forget to leave your thoughts below and I look forward to seeing you in the comments!
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Amazing post you just dropped now, I can tell you just change my view on investment, from the gold and land analogy I can say, the investment with returns as it appreciates is better. This is a new approach I want to adopt, I will also make a post about this.
Thanks for this @khaleelkazi
Great advice @khaleelkazi ...I don't have much to invest and stake myself but I'm very dedicated to the Steem blockchain and it's community and focus 100% on it! That's the beauty of it, one can choose after ones owns circumstances and it can still be greatly profitable...
Thanks @reko! I'm totally get where you're coming from, and I 1000% believe that you're doing an amazing job of giving back and investing your skills and genius to the Steem blockchain through many of your projects like steemfollower! Thank you for all you do! You're truly making the community better and we'll all make it to this moon together 🚀
We all really just work here on Steem to make money...I caught my self yesterday getting gas and the wife asked how much it was, and I said it was 10 Steem. Awesome, not even thinking. Wouldnt it be great if it all worked that way.
I totally agree! Steem is a great community and the reason it works so well is because we are all working towards the mission of adding value to ourselves which in turn adds value to the entire platform. By being selfish, you can actually be incredibly selfless towards the whole community! Soon we will all be thinking in terms of Steem!! 🤩
soon, my friend!
I like NEO so I know what you are saying. That is so much gas I wish I could produce the same. Hopefully soon I can get to a ton of gas a day. No pun intended ;P
Haha I love NEO, it's a great source of income as well as appreciation (I bought in at $20 🚀)
O will apply this methods
I'm glad you liked the post! Thanks for reading!
A timely post for me! I side with Warren Buffet. I think Steem is one of the best passive incomes.
I am also looking into coins like SmartCash that have the staking capabilities. SmartCash is down right now so a good opportunity to get the 1k coins to stake and get 7 percent a month return!
Great post.
Yes, STEEM's ability to produce passive income is off the charts, I love it!
I have also looked into SmartCash a bit, I'm trying to get a better handle on how it all works and I'm also looking into the masternodes. It's exciting stuff!
Thank you @sequentialvibe!
QOTD my answer: do everything. Finding the exact right trade will not happen unless I have one foot in it. I like to believe I am a good trader but in reality I am below average. If I truly have to pick between earning income versus buy low and sell high I would go with the former. Reason being I can not time things well but when I need capital I will not be strap if my investments are already paying me back. Sometimes the buy low and sell high occurrence takes years.
I too am hooked to passive income investments. I do not have any ARK but after reading your post I believe I must start saving some crypto to invest in ARK. I am aware of LISK, ARK, and RISE all delegate proof of stake and all have been rising in evaluation. I am still undecided between the 3 which to invest in but sounds like ARK is the way to go. Thanks.
Hey @mawit07! I agree, diversification and doing everything is a great way to diversify your risk exposure and get the most reliable profits. Income investing is one of the best ways to ensure that you don't tie up all your capital and have nothing to show for it for years on end (a situation that many people find themselves in).
Ark is very interesting! I would recommend doing your research before buying/staking! I am not a financial advisor. I do love Ark and think that it is really going to have a large impact in the crypto space and beyond! It really is a gamechanger and if the team executes, will surely go big! 🚀
I like the earning income strategy, that means you get consistent funds to pay for the things you need in life. Hoping to transform my basement for air bnb or a renter and to rent the house if I ever move out. I also like steem and NEO because they build on themselves.
Sometimes asset appreciation will win out though, especially in the crypto world, some of these coins have and will continue to 100x or more, they are riskier though.
I'm personally looking to find more sources of income myself, any ideas, I've got a smidge of time and a smidge of money haha!
Exactly, I think its always best to invest in income sources and never touch the principle, but live off of the income it produces!
A relative of mine does Airbnb rentals, she says that it makes pretty good money! That can be a great source of income for you!
I agree asset appreciation can be a great way to make money and I definitely invest in some assets with the hope that they appreciate in value. I just make sure that I invest the majority of my money into assets that will also produce an income over time. I have bought many cryptos that don't actually pay income, but they represent a smaller portion of all my investments.
haha I know the feeling! I'm always looking for new ones! The 4 I listed in the post are the main ones I'm using right now. There are others that vary depending on risk tolerance, income, capital, etc.
steem is the best to earn with no Risk
now adays there is a full risk in online market we cannot say anything on crypto so have to b safe working on steem take care!
Steem is very low risk in my opinion, not "no risk" but very little especially in comparison to the rest of the crypto market! Thanks for sharing your thoughts @khaleelahmed! You have a great name by the way 😉
This reasoning is why i am so bullish on exchange coins that give out dividends (COSS/ Kucoin shares). The coins themselves increase over time and they also spit out coins that will inevitably increase in value. Only negative i see is if something happens to the exchanges themselves. Fingers crossed.
Yes, exchange coins are very interesting to me. I’ve experienced some really good times and some really bad times in terms of exchanges and I think that they are a great addition to a diversified crypto portfolio! As you say, fingers crossed!
The smartest and richest people often spend their money on investments. While the poor and noodle class spend their money on material possessions. Love the mindset!
there is no obstacle ahead of you in order to get rich and get rich. you have a very beautiful idea and I am very happy to share it with us, I guess I can trust you.
Thank you for reading and for your kind words! I appreciate it!