15 Ways to Invest $1 MILLION

many of you want to become millionaires and some of you might already have crossed this milestone this is for both categories people say the first million dollars is the hardest to make but today a million dollars isn't what it used to be the catch is you need to have a million dollars to understand that it's not enough welcome to alex.com the place where future billionaires come to get inspired if you're not subscribed yet you're missing out so what is there to do watch until the end because we are breaking it down for you hello alexers and welcome back to this special sunday motivational video somehow you got your hands on a million dollars after taxes maybe you sold your first company maybe you got lucky and aunt jemima left you an inheritance buckle up because we'll take you through it all let's break down your best options here are 15 ways to invest one million dollars number one buy rental properties this is the first item on our list because this is what we did the moment real money started coming in all of it went toward buying rental properties what we're about to say will definitely step on some toes but one million dollars isn't enough to make you rich but if you know what you're doing with it one million dollars could mean you'll never be poor again at least that's how we did it one million dollars invested in rental properties will bring in between fifty thousand and one hundred thousand dollars per year in rental income and this is straight up paying cash for your properties if you know what you're doing and are open to using debt things can look much brighter you've got plenty of options to choose from single family multi-family commercial spaces anyone with 1 million dollars can pick up a couple of apartments near the city center or around business centers and live off the rent as we said earlier 50 to 100 000 per year before tax might not qualify as a rich living by any means but if you're frugal it means you and your family will no longer worry about food or bills again the average property appreciates by three to six percent in price every year so not only are you bringing in rental income but the price of the property is also going up this is important so pay attention the first million dollars park it in things that make you money while you sleep and then pretend you never had it a couple of nights ago we were hosting some friends and one of them raised the following question what would you do with 5 million dollars right now our answer put it next to the other ones and get back to work people wrongly assume if you get 1 million dollars you'll stop working and sip cuba libres in cuba on a beach only to get there and realize that life has more in store for them but maybe you're not a sophisticated real estate investor and don't know where to invest that's where this next option comes into play number two invest in an reit reit stands for real estate investment trust to put it simply people with money such as yourself join up and put the money together in a management fund the people who manage the fund go out into the marketplace and invest the money into properties that generate income the money coming in is then divided by how much every person has contributed to the fund reits are great for people who don't want to handle the day-to-day aspects of managing their rental properties and these funds also have the added benefit of getting yourself involved into bigger deals for example buying and renting an office building is definitely more expensive than picking up one or two apartments the type of deal that would be difficult to close on your own just google reit and your country and you'll find investment options in your geography it's important to know that if you're willing to put in the time you can get better returns on your own but at this stage it's all about saving you time number three bonds or cds never in a savings account truth be told we didn't want to include this one we were about to make a 10 list video but since you've been so vocal about including everything we put this in early so we can get it out of the way out of the three bonds are our favorite option they're super easy to understand you simply lend money to a corporation or the government and in exchange for your money you get paid a fixed amount regularly when the deadline on the bond expires you're paid back your initial amount if you need the money you can sell the bond to other people or back to the bank before the term you can find bonds in every country they vary between 2.5 and 6 percent and you can buy government bonds directly through your national bank just walk in and ask about them cds referring to certificate of deposits is another financial instrument where you basically agree with the bank that you'll leave your money untouched for a fixed amount of time and in exchange they'll provide you with a better interest rate personally we don't use these the highest return we've seen was under two percent and they don't have the same flexibility as bonds but at least they kind of keep up with inflation but it's still better than just keeping your money in a savings account we don't know about you but the worst thing for us is just having money sitting around losing its value every single day the us dollar is worth less and less the government keeps printing money and shoving it into the economy in order to compensate for the impact of the coronavirus and what does the marketplace do it reacts by absorbing the money and raising prices accordingly this is why real estate prices keep going up this is why jeff bezos is worth close to 200 billion dollars that's why tesla's stock price is going up the way it is right now it's just the market absorbing all the new cash we do not recommend keeping your money in a savings account for more than the short term do you know how much the bank pays you to have your money in a savings account per year 0.01 percent do you know what the average inflation rate is 2.44 if you keep one million dollars in a savings account for one year at the end you'll have one million and one hundred dollars the bank of america will effectively pay you one hundred dollars to keep one million dollars in your savings account don't believe us do the math yourself but the buying power drops because of inflation and effectively your money is now worth nine hundred and seventy five thousand six hundred dollars inflation just cost you almost twenty five thousand dollars in a single year no matter how you put it you're losing way more than you're earning and that my friends is why you never keep your money in a savings account or under your mattress for that matter number four gold silver and other metals if the previous point freaked you out by the impact inflation has on your wealth don't worry there are ways to protect yourself against inflation the preferred option of multimillionaires to make sure their money keeps its value is to convert it to gold and silver you can buy a gold or silver index on any trading company but you can also go about it the old school way go out and buy physical gold gold has been the go-to resource for store of value since the middle ages what we like about metals is every time governments screw with the economy smart investors always move their money out of the marketplace and into gold resulting in predictable jumps of the price of gold for example this is the price of gold for the past 20 years 2010 was the jump after the economy crashed in 2009 2020 we have coveted on our hands and are feeling that the entire stock market is in a bubble so people move their investments into gold at least for the medium term at this point you might be thinking why the hell would anyone invest in something other than gold just look at these numbers and the answer is fairly simple for sophisticated investors the price of gold is a barometer of just how quickly fiat currencies like the us dollar or euro are losing their buying power when you invest in gold although the price goes up the value remains the same your gold doesn't make you any more gold while you keep it in your safe it's just worth more in today's money if you want to grow your fortune you need to technically beat the return that gold provides number five index funds you want the hands down best option where to park your money and how to have it grow for you index funds is the answer but don't take our word for it someone asked warren buffett the following question what would you tell someone to do with a million dollars that is 30 years old unmarried and with no dependencies please be as specific as possible random man and buffett said i would invest in a vanguard index fund and get back to work that random man was tim ferriss the author of four hour work week and tools of titans for those of you have no idea what we're talking about allow us to introduce you to the s p 500 this is a fund that bundles together the top performing 500 companies in the us if a company does poorly it's automatically taken out and replaced with one coming up you're basically investing in the best companies all at once because of this level of diversification you're almost guaranteed that you'll make money over the long run ready to have your mind blown away the average annualized total return for the s p 500 index over the past 90 years is 9.8 almost 10 year after year for 90 years 1 million dollars invested today at 9.8 percent over 10 years means 2.6 million dollars keep it there for 20 years and you'll end up with 6.5 million if you're young and have time on your side leave it for 30 years and you'll end up with 16.5 million dollars this is why even albert einstein considered compound interest as the eighth wonder of the world and this is how you make sure you never go broke set it and forget it and your entire family tree could live off the interest when you retire we're not sponsored by them but hands down the best way to invest in an index fund right now is vanguard check out if they're available in your geography and start learning more about them and if this is exciting for you and something you want to take full advantage of in your lifetime we recommend you pick up the following book money master the game we'll link to it in the description it's a simple read that walks you through the entire industry even better if you go to alex.com free book and it's your first time signing up you can get the audiobook version for free thanks to our friends at audible number six stock market all this investment talk probably has your blood flowing and the more you think about it the more you come to realize maybe you can do better than 10 a year you've seen tesla stock price increase five times since march 2020 and want a piece of the action we promise to always keep it 100 with you statistically nobody beats the market in the long run but every now and then great opportunities present themselves and for those who are willing to take advantage of them you could really win big a while back we did a video of the stocks we've invested in during the pandemic which you can check out by clicking in the top right corner and we've been able to cash in substantial returns because of it and we're nowhere near the point of sale although most of our stock funds are just growing in an index fund now and then we love the rush you get when you play the market and get it right the best way to learn is to simply invest a small amount of real money don't fool yourself trading with demo money and then play it as safe as you can you'll learn more and more by having money on the table than if you just played investor the internet is filled with stock investment platforms so you should have no problem finding one we are not paid or sponsored by any of these but some great beginner options are robinhood revolut etoro and so on if you really want to do this you'll find a platform that works for you number seven start a business with the more passive options out of the way it's time to get busy if you had a million dollars and wanted to invest in a business why not invest in your own business that way you're taking in all of the risk but you'll also enjoy all of the returns starting a business is a lot more complicated than having a job it's more like you have multiple jobs and you're not getting paid unless the business survives and thrives for a couple of years sure the million dollars you have under your belt will prove to be quite an advantage and allow you to hire better people and buy the tools you need to accelerate your growth but don't fall into the trap of overspending anyone can make money if they have money the goal is to make some without spending any as long as you have a frugal mentality when it comes to your own business you'll be able to grow it steadily and organically we've made a video called 15 things you need to know before starting your first business that we strongly recommend you check out you should see a card in the top right corner but what if you don't want to take on the burden of starting a new business from scratch well then the next option might be for you number eight angel invest angel investing is when a new startup needs money and help to take the project off the ground and you're the one who provides that capital and expertise in exchange for a percentage of the business with the age of tech startups popping up left right and center everyone wants to think of themselves as an angel investor but truth be told it's probably the highest risk option on this entire list no matter how good you are if the company you're investing in isn't the one to take the project where it needs to go it will fail and so will your investment a seed investment varies between ten thousand to one hundred thousand dollars this money is used to get the company to create what is called a minimum viable product and pick up a bit of traction based on how well you do at this stage you can then go ahead and raise more funds at a higher valuation seed investments aren't as complicated as they seem but you never want to be what we call in the industry dumb money dumb money refers to someone who doesn't bring anything else to the table apart from money only invest in businesses you understand and have the expertise and connections to accelerate their growth the entire process used to be rather complicated but today you have options like angel list angel.co where you can invest in startups from anywhere in the world as an angel investor and no they're not a sponsor either we kind of hate how we have to say that every single time number nine venture capital fund investing in companies is also evolving and that's where the funds come in instead of hand picking one or two startups to invest in you can take the index fund approach here and pool your money with other investors so you diversify your investment and minimize your risk that's how venture capital funds came to be your 1 million investment could back 10 to 20 different companies statistically 10 of them will fail completely five will barely hold on for dear life four will grow steadily and maybe one will blow up your bet here is the money you'll make off of this one will be enough to make a profit these collective funds have grown in popularity throughout the world and they usually have a minimum entry level to allow you to invest some might even have you commit a recurring amount of money every quarter so make sure you understand what you're getting yourself into for beginner investors we definitely wouldn't recommend venture capital as your main option if you made or have one million dollars there are much safer ways to go about it without risking it all and speaking of risk number 10 crypto you know how at number four we talked about gold as a store of value for years it was the best option we had until more recently when bitcoin came around which is why people call bitcoin gold 2.0 the gold of the internet generation we are strong believers in blockchain and what this technology will do around the world in the future and the idea that you could park money that no government can print more of is definitely appealing to every investor out there the price of bitcoin at the end of march 2020 when the covid situation happened dropped to around five thousand dollars as of making this video the price is just under 12 000. the entire ecosystem is evolving the entire process becomes a lot simpler and leaner to access many of you are put off because you feel like you don't understand the technology and how to go about it in a safe way so we've got you covered right now we're in the post-production parts of a new course on bitcoin and blockchain where we do just that we handhold you from the beginning to the end explaining in layman's terms how the technology works and show you the exact tools we use to buy hold and sell our own bitcoin if you're interested in this course we've set up a waiting list at alux.com bitcoin make sure to add your email so you're notified when the course goes live number 11. peer-to-peer lending peer-to-peer lending is the old practice of giving someone your money and having them pay it back with interest very similar to how banks and loan sharks do it but completely legal even technology got involved and now there are plenty of peer-to-peer lending platforms online we personally don't use any of them but other acquaintances of ours do some of these platforms will show big promises of 12 to 15 to 20 yearly returns and although you can hit those kinds of numbers we've never personally looked at peer-to-peer lending as a long-term strategy it could work for those of you with a little capital and higher risk levels but honestly if you have a million dollars to put down you'll most likely have better and safer alternatives but for those interested to check them out here are the best peer-to-peer options according to investorpedia who knows maybe you'll find something you like number 12 invest in art and collectibles if you had a million dollars there's no way we let you spend it all on supreme gear or jordans because the resale market is where it's at bro although there is some truth to that y'all are too young to know about the beanie babies but here's an education piece for ya in the early 90s instead of rare jordans and yeezys people were reselling plush toys called beanie babies the most expensive ones sold for over six hundred and fifty thousand dollars with many of them reselling between ten thousand and fifty thousand dollars it's safe to say it was a fad that went away would you pay fifty thousand dollars for a plush toy today of course you wouldn't and something similar is happening today with hyper beast fashion the actual alternative asset class to invest in is actual art art is the last loosely regulated market with prices constantly going up at least when it comes to heritage pieces very few people know this but blue chip art has outperformed the s p 500 for the past 20 years the problem here is where do you even start unless you have someone who actually knows what the hell they're doing you're better off buying bonds and leaving it at that but even the art market has evolved in the past couple of years once again not a sponsor but there is this platform called masterworks.io that allows you to invest in art the same way you would a venture capital fund the alternative is mutualart.com that shows when certain pieces come up for sale our recommendation would be to never throw more than 10 percent of your net worth into alternative assets because even if you know what you're doing there's still an element of real value versus perceived value which doesn't apply when it comes to let's say buildings or land so definitely be careful number 13. buy a franchise business a million dollars buys you at least one mainstream franchise business the beauty of this franchise model is that most business problems are already solved all you have to do is be a great manager or even better find one and your business will keep printing you cash franchise businesses rely on a hefty investment but they provide you with the equipment the training and the already established brand at this point in time if you're looking to start a coffee shop business and a starbucks opens up next to you you're basically done so why wouldn't you be the one opening up the starbucks let's break it down you'll need to pay an initial fee of somewhere between forty thousand and ninety thousand dollars to purchase the starbucks franchise this covers the equipment and branding and have a net worth of at least two hundred and fifty thousand dollars with at least 125 000 of that liquid and ready to pour into the business in order to cover the initial running costs the franchise fee for mcdonald's is 45 000 to which you add the property costs and the initial day-to-day capital these are brands people love starbucks mcdonald's kfc subway dunkin taco bell there are also cheaper options but if you had a million dollars we would first open up one spot in a good location and only then expand into more territories a couple of weeks ago we also did a video on franchises that are blowing up right now that almost nobody watched click in the top right corner for that one number 14 land with land the deal is pretty straightforward you buy the land you hold the land for some time and then you sell the land for massive profits we love land as an investment even the idea that you can literally own a piece of the earth that you can leave to your children to this day is mind-blowing to us the basic formula for land acquisition is pretty simple buy land 30 to 50 kilometers outside of any major city and wait 20 years the world population is growing and for the foreseeable future businesses will still concentrate their headquarters in large cities people working in these corporations need their housing nearby thus the land outside of the city is constantly developing it won't be long until developers come knocking on your door interested in building these developers will either straight up want to buy the land from you or more often than not work out a deal where they cover the building cost you provide the land and you split the profits if you have a million dollars worth of land and 20 years go by just the sale of a small portion could be more than enough to solidify your rich status if you're interested in playing the game you can develop the land yourself build an apartment building or houses right now we're seeing a lot of potential with agricultural land that is not far from commercial hubs you're getting it 10 to 20 times cheaper and if the expansion of the city goes your way it won't be long until you have utilities and roads nearby number 15 emerging markets when we say emerging markets we're talking about two things one developing countries and two emerging trends for example we already know that india has a large population and right now telecom is booming as a business this means in the next decade almost 1 billion new people will be joining the online marketplace these people will need to buy sell trade use services and more the same thing is happening to south america and africa every successful business in what is traditionally called the west will be adapted and localized in the u.s you have zillow as the main real estate portal and amazon as the main e-commerce store who's going to dominate these markets locally grassroots companies have the unfair advantage of understanding the customer better than these giants who aren't as agile in development so there is an opportunity to take your million dollars back to your home country and turn it into a fortune the other aspect has to do with emerging trends and where the world is heading toward tesla became the most valuable car company because elon went all in on the electric car when nobody believed in the project and most people never considered they would ever buy an electric car the transition from petrol to electric is a trend everything that was traditionally powered by petrol will soon rely on renewable energy another big trend is ridding the world of plastic we hate the paper straws as much as the next guy but it won't be long until someone figures out a unique combination that's maybe better than plastic without the turtles snorting them another trend we're seeing has to do with consuming local foods if you go to any supermarket right now the tomatoes are from mexico or italy the garlic is from turkey or egypt and so on why is it cheaper to pack and collect the garlic in egypt put it on trucks take it to the port put it on a ship carry it to here house it there and distribute it to all the supermarkets for you to buy somehow all of this middleman cost will be cut out at some point and whoever figures it out will win the challenge if you have a million dollars to invest we've outlined your best options personally we would do a combination of two or three of these but that's us at this point it's just a matter of what you believe would make the most sense for you which raises the question if you had one million dollars how would you invest it join the thousands of aluxers who are currently debating this in the comments section below and as a thank you for sticking with us until the end of course you're getting a well-deserved bonus piece of info one million dollars doesn't mean you're rich today one million dollars makes you upper middle class at best sorry to break it to you when we were growing up one million dollars was the goal to shoot for because in our minds that would have been enough to never have to worry about money again times have changed though governments have been printing money like crazy things are getting more and more expensive and that goal has been moved accordingly youtubers like mr beast are giving away 1 million dollars for your entertainment the million is no longer as rare a unicorn as it used to be we're not there yet but before you die billionaire will become the new millionaire all it takes is for jeff bezos to crack that one trillion dollar net worth and suddenly the switch will happen by the way he's on track to get there by 2027 which is crazy in itself as of 2020 in order to feel rich enough to not have to worry about money you would need to be worth between 8 to 15 million this would be enough to qualify you as an hnwi high net worth individual it took us just under 10 years to go from zero to the first million and by the time we got to it the world had already changed if you're starting today we don't recommend shooting for one million dollars because then you're aiming too low instead try to find business opportunities that have the potential to go beyond 20 million dollars if they work out that way by the time you hit it with inflation adjusted you'd be just right if you're going to work anyway you might as well win big keep these goals for yourself you're different than everyone else if you told your loved ones that one million dollars isn't enough money and you'd actually need 20 million dollars to be rich they will genuinely laugh at you and think you're insane this is why you need to set big goals and keep them to yourself big goals scare people with little vision if you're ready for a big goal please write the word big as your answer to today's question that way we know the message got to all the right people thank you for spending some time with us aluxers make sure to like and subscribe so you never miss another video we also hand-picked these videos which we recommend you watch next you can talk to us on all social medias or ask a question on our website alux.com thank you for being an a-lexer and we'll see you back tomorrow

Channel: Alux.com

Views: 580,899

Keywords: Alux, Alux.com, Alux Youtube, fine living, invest, invest 1 million, invest $1 million, ways to invest, million dollars, invest in real estate, invest in crypto, invest in stocks, index funds, millionaire investment, invest one million, million dollar investment

Id: 2UjSpGxUX64

Length: 26min 52sec (1612 seconds)

Published: Sun Aug 30 2020

Reddit Comments

[u/CryptoBlackbird]

While this video probably won't be the trigger for mass adoption it's definitely a good sign.

Bitcoin is showing up more and more in mainstream media and Google trends show the search term "Crypto" is at a new high since 2018 March (after the big bull run https://trends.google.com/trends/explore?date=today%205-y&geo=US&q=crypto )

IMO mass adoption won't happen in the next 3-5 years but it's still just a matter of time.

[u/maxcoiner]

Not bad. Looking forward to their full-Bitcoin episode.

[u/sersimovi]

Many people not realizing about this, I'm seeing more popular non crypto channels talking about bitcoin...

[u/SwapzoneIO]

Well, another step for mass adoption.

[u/renepickhardt]

doesn't seem like there are really 3 million subscribers. In the last 30 days only 3 out of 30 videos had more than 100k views. non of them had 200k views.

Also it seems to me that they just want to collect mail addresses for a blockchain class... there is enough content on bitcoin wiki or good lectures on youtube and blogarticles if you want to learn about bitcoin (:

[u/Bitcoin_to_da_Moon]

i only support bitcoin´s timechain

[u/PlaxicoCN]

I think multiple institutional investors are a more positive sign. Thanks for posting this though.

[u/[deleted]]

People watch this shit?

It's written and spoken by AI right?

I can join an email waiting list for their course? Much wow!

[u/jaumenuez]

The herd is not coming and may never come because they feel better not being responsible, and don't have money to invest in btc. Look at how many people is buying gold today and you will see how many will buy btc tomorrow.