I prefer to call myself a “lazy investor.” Does that mean I’m uneducated and don’t make informed decisions about where I put my money? Of course not. It just means that in the over 20 years I’ve been putting away money, the one trait I’ve accepted about myself is that when it comes to investing I do not like to put a lot of work into it.
Some call it passive investing and I completely agree with that. There’s a big difference between the active work I do for an income and where I put my money to grow without keeping a close eye on it.
Other investors like to be active with where they put their money. I’m not saying that either method is better. If you like to keep a close eye on your investments and be relatively or completely hands on with them, that’s totally your prerogative.
However, for the purposes of this article I want to share a couple of examples of how I “lazily” invest my money.
Lazy Investing in the Stock Market
I prefer not to argue with nor challenge the returns that the S&P 500 have yielded over time.
When the majority of hedge funds and fund managers have failed to equal or beat the S&P 500 over the last 100 years then it’s fair to say that putting your money that tracks this index or something very close to it is an investment you don’t have to watch often.
I tried investing in individual stocks and frankly it takes hard work, monitoring and a much keener understanding of companies than investing in the overall market. Plus when Warren Buffett says that’s where he’d put 90% of his money if he weren’t himself, I tend to listen to that advice.
Again, there’s absolutely nothing wrong with attempting to beat the market on your own but the odds are unfortunately not in your favor. I generally rest easily at night with the thought that over time I’ll do just fine. Sure it hurts when markets go down but I don’t freak out knowing my time line is long term.
Checking my portfolio once a quarter is more than enough in this scenario.
Lazy Investing with Real Estate
I’ve always wanted to own physical property.
I like the idea of using leverage to own a piece of real estate that’s worth 5 times more than the down payment I put on it. And the prospect of that property paying for itself by me renting it out is extremely alluring.
However, I could never get past the whole “managing” part of it. Remember, if you own a piece of property you are a landlord and you’ve got to keep your eye on things. You have multiple issues to deal with.
I’m not saying you shouldn’t do this because the returns might be higher than if you just invest in a stock or fund, but you really have to be committed and knowledgeable.
And yes, you can invest in turnkey properties where people are doing all of this for you and you still retain ownership of the property, but remember these companies charge you to manage the property so your returns aren’t as high.
What do I do? I invest in the overall REIT Index. In other words I invest in the companies that buy up properties and manage them. I get to have a piece of owning properties without having to do any of the work, plus I get to collect dividends.
It’s basically the same as investing in the S&P 500 only it’s for real estate. Another place I have some money in real estate is in Crowdfunding. Here you actually get to own pieces of large real estate properties along with 1000s of other investors who pool their money on a platform and said platform is the one who buys and manages the properties.
Other Forms of Lazy Investing
There are other ways of lazy investing I like as well.
- One of them is a high yield savings account. Interest is complete garbage right now but at least I know I’m not losing money and there’s a guaranteed rate of return on it.
- I also do a bit of peer to peer lending. It’s on the riskier side but again, you don’t have to do anything except put your money in.
- There are also CDs which yield guaranteed rates but you have to have your money in them for a certain period of time.
- And finally, there are bonds. Though I invest in bonds through the fund I’m invested in.
Remember, there’s no one right answer here. I’m simply sharing that I don’t like to do any work when it comes to my investments and these methods might give you an idea on where you might consider putting your money.