First, anyone who says that 30% returns are impossible are completely close-minded.
There are tons of ways to get returns of 30%, or even higher. You just have to think creatively and do a little more work…
Here are 5 ways that you can get 30% returns annually:
1. Hard money lender. A typical hard money loan is around 15%. Do two of these loans a year with 6 month terms and that is a total of 30% on an annualized basis. Is it risky? Not at all. Just make sure the borrower collateralizes the loan with something that is worth more than they are borrowing.
2. Rental real estate. You can rent unique properties for short periods of time that will yield much higher rates. For example, I own a very small studio near a beach. I rent it out short term (weekly or month-to-month) and get around ~40% annualized returns. It’s a lot more work than renting out a house on a yearly basis, but I get a lot more money.
3. Flipping vehicles. This is a strange one… but listen to this: Buy a moderately used car that is dirty/neglected. Spend a little bit of time on it. Clean it up. Make it smell good. Do a couple of nice modifications. List it in a very nice Craigslist add that is very detailed with excellent pictures. I used to do this in college with one or two cars per year, and I usually almost doubled my money. It’s a lot of work, but hey, 100% returns ain’t bad.
4. Start a tiny business. I mean really really tiny. Buy a box truck for a couple grand. Get a company to pay you to wrap it in a vinyl advertisement. Use a couple hundred bucks to hire someone to drive that truck around. Make sure that the company advertising is paying you 30% more than you are paying to get that truck driven around. Ever see those trucks driving around Las Vegas, Hollywood or New York? Somebody is making money there…
5. Trade stocks. Everyone says, “Oh, 30% yield trading stocks is impossible. Only the best traders out there can do that.” For the most part, that is correct. But, what if you spend a couple hours a day researching, reading and making very smart and conservative investments? The point is, it is possible, you just gotta work for it.
(I’m currently yielding just under 30% this year. I don’t say it to brag, but to say, “Hey, I’m a regular dude who is not some genius… I just put in the hard work and stay disciplined. Anyone can do that.” I will admit, however, that maintaining those gains over consecutive years is a whole ‘nother story.)
Ok… obviously, all of these ideas require a bit of work. Some a lot of work.
But that is what investing is all about.
To quote Benjamin Graham, the author of The Intelligent Investor:
“The rate of return sought should be dependent, rather, on the amount of intelligent effort the investor is willing and able to bring to bear on his task.
“The minimum return goes to our passive investor, who wants both safety and freedom from concern.
“The maximum return would be realized by the alert and enterprising investor who exercises maximum intelligence and skill.”
What level of risk are you taking to get just under 30% returns on stocks?
That is quite subjective… I don’t think I am taking on much risk at all… but another trader may think there is a lot of risk.
The gains are mostly in gold miners. I have had some tank, but the majority of my holding are up 75%… a couple are well above 100% gains since the beginning of the year. I believe there will be much more to come.
Of course, the 30% gains are the average… meaning that some holdings (non gold miners) have remained flat or ‘only’ up several percent.