Businesses are usually trapped to keep surplus cash if you are dealing with high cash transactions. It would be an alarming situation for you. You should think about the ways to grow and secure your cash beyond the interest offered by banks on savings.
There are plenty of other options that serve more than double the return of your investments. So, what are these?
Let’s know about the four most common and lucrative investment options for businesses:
1. Crypto Currencies or ICO’s
Investing in cryptocurrencies is one of the most trending ways to get higher returns in a short time. You just need to know about ICO’s or Blockchain, then creating your investment portfolio can help start earning.
Keep in mind, ICO’s is a little risky and tricky. Therefore, conducting good research before investing. You can also hire an experienced tax accountant that supports you to deal with tax implications from your crypto investments.
2. Invest in real estate
Real estate investment is the safest way to secure your funds. If you will start exploring, you will get great opportunities in commercial and residential real estate. Choosing anyone will help you to start creating passive income for a business.
These days, businesses also look for nnn properties for sale as real estate investments. One of the major reasons is it helps in reducing capital expenditures and benefits in tax deductions. You have to write off only interest on a mortgage, whereas the lease amount is 100 percent deductible.
You can grow your business profit either by utilizing space for renting or for expansion.
3. P2P Lending
P2P lending serves you higher returns than traditional banks’ interest rates. You just need to search for people or businesses looking for this loan option. You can even take assistance from various websites or applications that create a connection between vendors and investors.
Keep in mind peer to peer lending could be risky until you are not sure about the borrower. Therefore, it is highly recommended to hire an expert who can identify a borrower’s lending capacity. You can also check a person’s past credit history and credit score for a better understanding.
Prevention is always better than cure, so choose this option, but after considering the borrower’s credit history and your risk-bearing capacity.
A bond is a fixed income instrument and is mainly issued by companies or businesses to finance a project. The receiver likes to issue bond certificates to pay an amount with interest over a certain period.
Bonds are a less risky investment option compared to equity or others. If you want to invest business funds in bonds, remember that there are three major types of bonds – corporate, municipal, and Treasury. You can invest in two ways.
One where you will get the amount only after maturity till that time you can enjoy interest payment. Another way is by selling bonds at a higher price than you have purchased.
Hope the above information helps you to choose the best strategy to manage your surplus funds. Notably, you can choose any way to invest after cleaning your investment purpose and risk-bearing capacity.
For high-risk choose crypto or P2P lending and for low-risk real estate investment or Bonds are perfect options to use your surplus income.