David Morey 
Alt Title: Tips for Seeking a Better ROI From Your Investments
The whole point of investing is to secure a positive return. The more you earn from your investments, the higher your return on investment (ROI) will be – and the more wealth you’ll be able to accumulate in the long run.
Obviously, every investor should be motivated to earn as much as possible from the money they put into their investments. But in practice, this can be extremely challenging.
How exactly are you supposed to secure a higher ROI from your investment portfolio?
Understand the Complexities
First, it’s important for you to understand the complexities of investing. Unfortunately, there’s no “one weird trick” that can help you make more money from your investments, nor are there specific assets or holdings that are going to magically triple your returns.
For example, consider the real estate market. In real estate investing, there are multiple ways to make money from your investments. You can make money through property appreciation, rental income, and even additional strategies like offering coin-operated washing machines or additional storage space for your tenants. The dynamics are different between residential and commercial real estate, and you can also invest in real estate investment trusts (REITs). You can improve your property with renovations, invest more in marketing to fill your units faster, and make other expenditures to potentially increase your return, but are they really worth it?
With so many variables in play, there are no clear answers. What works in one area may not work in another. What works for one investor may not work for another.
Accordingly, most of our strategies are going to be broad ones that need to be applied carefully and with consideration in any specific application.
With that in mind, these are some of the best ways to achieve a higher ROI in your investment portfolio.
· Diversify. The first key is to diversify your portfolio. This is advice you’ve probably received before, and you’ll likely receive it again because it’s some of the most important advice in the investing world. Diversifying a portfolio means securing a wide range of asset classes and different assets within those classes. It’s a way of compensating for risks while simultaneously increasing the stability of your returns. Investing in high-risk, high-reward assets as well as low-risk, low-reward assets helps you get the best of both worlds, ultimately pushing your returns higher in the long run.
· Properly research your investments. You also need to properly research your investments. Don’t invest in real estate just because your wealthy neighbor told you to. Don’t invest in a stock or cryptocurrency just because someone on the internet said it was a good idea. Before investing in anything, you need to thoroughly understand the risks, the potential returns, and how they fit into your portfolio. You don’t need to be a super genius, but you do need to be willing to put in the work.
· Plan for the long-term future. Optimize your portfolio and all your investing decisions for the long term. There’s nothing inherently wrong with chasing quick gains and short sells, but these maneuvers are typically associated with lower returns overall.
· Use tax-advantaged accounts. As much as possible, invest using accounts with tax advantages, such as 401K plans, Roth IRAs, and similar investment vehicles. These accounts can give you more money to invest or allow you to withdraw with fewer penalties, so you can ultimately make more money from less money.
· Practice smart tax planning. Aside from that, you still need to plan and account for taxes. Taxes can eat a chunk of your returns if you aren’t careful, so you need to know which taxes apply to you and how to minimize them.
· Ditch the financial advisors. Financial advisors can be helpful in some situations and for some types of people, but they also tend to be expensive. Since most people can learn how to invest properly on their own, consider ditching them.
· Reinvest your proceeds. Consider reinvesting your proceeds whenever possible and practical. For example, you can use rental income to fuel the purchase of more properties or use your dividends to buy more shares of stock.
· Go against the grain. Don’t be afraid to go against the grain. When markets are fearful, prices drop, representing a valuable investment opportunity if you’re willing to deviate from popular perceptions. Similarly, when markets are greedy, prices rise, representing an opportunity to sell and turn a massive profit.
Hopefully, these strategies have helped you better understand the nature of your investments and how to secure a higher return from them. When put into practice consistently and with more experience, you should be able to greatly increase the value you get from your investments.
