The stock market’s ups and downs are too dangerous for seniors. One wrong move and years of hard-earned resources may go down the drain. Thankfully, there are alternative retirement options besides the risky world of stocks. From real estate to bonds, here are 15 innovative and reliable investment options for seniors who want more stability in their retirement savings.
Annuities
When seniors invest a lump sum or make regular payments to an insurance company, they can receive a steady income stream for life or a set period. Unlike stocks, annuities are guaranteed income. This conservative option doesn’t require learning, so it’s perfect for amateur investors. While fixed annuities have predictable returns, variable annuities work better for investment growth.
Real Estate
This investment alternative is as old as time. It is also the most common way for the middle class to build wealth. Besides the cash equity, seniors can generate steady passive income through monthly rent when they buy and rent out properties. Real estate also has financial benefits like tax breaks, competitive returns, and a hedge against inflation.
Real Estate Investment Trusts (REITs)
As a senior, you don’t have to own a property before earning from real estate. There’s also an opportunity to buy shares in Real Estate Investment Trusts or REITs. They are companies that pool money to buy, manage, and sell income-generating properties like office buildings, apartments, and shopping centers. The best part? You don’t have to take on responsibilities like maintenance or renovation.
Savings Bonds
According to the US Department of Treasury, a savings bond is “a simple, safe, and affordable loan given to the federal government.” Although treasury savings bonds were gifts from parents to their children, retiring folks can use them as a low-risk, inflation-free investment. Seniors can buy savings bonds through the Treasury’s website or at banks and cash them in after a period.
Certificates of Deposit (CDs)
When seniors lock their money into a CD with a bank for a fixed period (e.g., six months or five years), the bank gives them interest much higher than a regular savings account. Investopedia reports that the average CD is about three to four times the national interest rate. Fortunately, CDs are FDIC-insured, so they’re secure and predictable.
Private Equity Funds
This alternative is one of the easiest ways to invest with huge returns or diversify one’s portfolio. It’s ideal for individuals with a high net worth who want to make more with their sizable income. Although private equity funds are for qualified and accredited investors and clients, seniors can access them through specialized investment firms.
Art & Antiques
Investing in art and antiques can be both enjoyable and lucrative for seniors who don’t need immediate access to their money. Valuable paintings, sculptures, or antique furniture often appreciate over time, especially when kept in good condition, before attending auctions or visiting galleries. Seniors should have enough market knowledge or find someone who does for the best returns.
Money Market Fund
A money market fund is an FDIC-insured, low-risk investment option for seniors who prefer liquidity. These funds invest in short-term, high-quality debt securities like US Treasury bills. Seniors can invest through their banks or financial advisors, earning a small but stable return. While the returns are modest, money market funds are more easily accessible than other investment types.
Gold, Silver, & Other Precious Metals
Precious metals, including gold and silver, are guaranteed to hold their value over an extended period. It’s a classic strategy for seniors who want to hedge against inflation and economic uncertainty. Seniors can invest in physical bullion, coins, or exchange-traded funds (ETFs) specializing in precious metals. Platinum and palladium are also great choices that can give older people stability.
US Treasury Securities
For retirees who don’t want to gamble with their investments, US Treasury securities, like bonds and T-bills, are one of the safest tax-exempt options. The Department of Treasury maintains that the full faith and credit of the US government backs this investment option. Seniors can buy them directly from the Treasury’s website or through a broker.
Royalty Investments
Investing in royalties means buying the rights to earn money from music, films, books, and any intellectual property. Seniors can get steady cash flow from creative industries or even natural resources like oil and gas. Every time the asset makes money, they get a share. It’s a safe way to earn without owning or managing the whole thing!
Antique Cars
Although the average car loses its value the second it’s driven off the dealership, investing in antique cars is a fun and rewarding way for seniors to grow their retirement portfolio. Classic cars increase in value over time, especially if they’re well-maintained or rare, like the Ferrari 250 GTO. Seniors can research collectible models or seek trusted, professional advice.
Farmland
As of 2022, the market value of US farmlands has grown by 3.9 percent yearly. These encouraging figures from the US Department of Agriculture mean retirees can generate steady income by leasing land or running a farm. Additionally, farmland value typically appreciates over time. Seniors can invest directly by purchasing land or indirectly through REITs mentioned earlier.
Fashion
Just as quality fashion pieces from the Victorian era are pricey, top-tier items from this era, like designer handbags or limited-edition shoes, would be highly sought after in a few dozen years. They often retain or grow in value, especially when they’re rare. However, seniors must follow professional advice and choose well-known brands with a history of strong resale value.
Memorabilia
The list of valuable memorabilia is endless and includes sports jerseys, Hot Wheels, LEGO, Star Wars, Marvel, and DCEU. These collectible items, especially rare or autographed pieces, often increase in value with time and are less stressful for seniors. Consulting group Market Decipher even predicts spontaneous growth in the sports memorabilia market from $26.1 billion in 2021 to $227.2 billion by 2032.
