Investing in today’s economy can be a challenging task, especially if you’re unsure about where to begin. After establishing a budget and an emergency savings fund, it’s natural to think about investing your money. However, in this ever-changing world, it’s crucial to consider how to invest in this economy. One of the most important investment principles, especially as world and US economics shift, is diversification. By spreading your investments across different asset classes, you can help reduce your overall risk and add protection to your assets from market volatility.
Diversification is key, which means the days of investing in only one asset are over. If you want to get ahead of the curve, it’s time to explore different investment options. Here are a few methods to research that can protect your assets against fluctuations in the value of the U.S. dollar (USD):
Consider non-U.S. currencies & companies: Instead of holding all of your investments in USD, you could diversify by investing in non-U.S. assets, such as foreign exchange-traded funds (ETFs), and index funds like $VWO, $EFA, $IXUS, $DLS, or $BWX.
Consider precious metals: Precious metals such as gold, silver, and platinum can provide protection against inflation and currency fluctuations. You can invest in physical metals or through ETFs that track the price of these metals, such as $AAAU, $OUNZ, or $IAUF.
Consider real estate: Real estate can be a good long-term investment option that can provide a steady stream of income through rental payments or appreciation in property value. This can be done through purchasing land or property, or investing in real estate investment trusts (REITs).
Consider cryptocurrency: Cryptocurrencies such as Bitcoin, Ethereum, and Litecoin can provide an alternative investment option to traditional currencies. However, investing in cryptocurrencies can be volatile and should be done with caution.
It’s essential to do your research and consider consulting with a financial advisor before making any investment decisions. These are just a few examples of potential investments on which to educate yourself. For further reading on personal finance & investing, including key terms & phrases needed for your wealth journey, read Personal Finance Crash Course: What They Didn’t Teach You in School.
P.S. – Did you know Cleveland will have its own Wealth Wellness Weekend this summer? Mark your calendars for July 21-23! Visit www.phebefoundation.org or follow @thephebefoundation on Instagram to stay up to date!
Ray’Chel Wilson, CFEI®, a Toledo native, the author of the Black Wealth Freedom series, and CEO of Raise the Bar Investments. Ray’Chel is also the founder of an upcoming app, #ForOurLastNames, empowering first-generation investors. Her mission is to close the racial & gender wealth gaps through investing.