Best way for a newbie to invest 50K?

Hi Sher

There are many considerations and without knowing more about your personal circumstances it is difficult to provide a more educated response.

I am assuming you are working and if this is the case you could certainly look at some form of gearing.

This will enable you to control an asset value considering higher than your current savings.

Next of course is your risk level.

Sure you could look at trading Options or Futures for monthly income but you could also see your money disappear fairly rapidly.

You mention you want a monthly income so your options are going to fairly limited.

Depending on where you are located you could look at investing a development and receiving a monthly income or equity at the end of the project.

As i say difficult one to answer without more information.

Cheers

Yours in Finance

SherJava .. as a newbie armed with what can be anything up to a 5% deposit you could gear heavily or you could gear to a level that you decide is an acceptable risk.

(1) Work out your acceptable risk level. Allow for the possiblity of loss of income .. loss of tenancies .. extended wait periods inbetween tenancies and finally instant or ongoing maintainence.

(2) If you want to borrow .. make allowance for payment of the loan at 9%. Why 9%??? Because historically the fluctuation of interest rate levels waver +3 or -3 on this rate level .. averaging out at a little higher than 9%. So if you accept your ability to approach the loan at that rate .. then you should be able to take on the loan. Take a lower interest period as a bonus and not a granted period of acceptance.

(3) The third is substantially more difficult in the current climate .. but very much still possible. That is .. use the 50k as a method of deposit with the possibility to improve .. either through negotiated best terms ..or creating appropriate solutions to make significant profits on enhancing a property. As stated .. in this period of the property clock .. its not impossible .. just a lot harder.

My suggestion considering you are currently living with your parents would be to create value added solutions. Your level of available cash would limit you to smaller propositions .. but .. thats always a good start. In this period of low interest you might want to consider high level borrowing so as to maximise your longer term passive income results.

Build a bank, so that your options when you approach the next opportunity .. you are more flexible on what you can achieve. Or build that bank to create a reasonable deposit for a house.

The options remain up to you. Its the time you allocate to achieve the outcome that will further the possibility of achieving a winning .. profitable and strategically acceptable result.