VI Blog

5 Best Investments for Cash Flow in 2022

22 Sep 2022

Best Investments for Cash Flow | VI College

The world is spinning quickly, and only those who are financially literate are winning.

These days, you have to have more than one income stream to live comfortably. While you’re sure going to find jobs you feel best suit you and bring out your competencies, there’s an equal chance you’ll still have to take up extra gigs to cover various expenses.

Fortunately, if you know how to play your cards right, life doesn’t have to be as gloomy as the movies make them out to be. For example, the best investments for cash flow allow you to pursue creative passions all while furthering your financial goals.

But what exactly are the best cash flow investments?

Let’s go over 5 cash flow investment ideas you can consider.

1. Real estate

There’s no surprise here. Real estate continues to be a terrific cash cow. It’s a steady investment because money keeps pouring in. Of course, it’ll depend on what type of space you own. But generally, residential and office areas generate a substantial amount of passive income.

There are multiple ways you can approach this strategy, and the two most popular ways you can succeed with real estate are by either buying your own property and renting it out or by being part of a real estate syndication.

Real estate syndications are essentially a team of investors that own property and split its earnings from rental dues. This form of entrepreneurship usually falls under limited liability companies (LLC), where members hang on to an investment for a good number of years, committing to improving the space to better its chances of a higher resale value.

The average American renter pays over $1,300 a month in 2022. Naturally, more expensive cities like Manhattan and San Francisco can charge more. Today, you’ll need about $2,000 to move into a residential studio, with single-family houses averaging more in a month.

For real estate investors, this can translate into a regular couple of thousands depending on how many apartments or units you rent out. Additionally, because land is permanent, real estate properties are said to increase nearly 7% every year. What’s more, research suggests that real estate syndications grant investors roughly a 20% yearly return from their initial capital.

If commercial spots from Real Estate Investment Trust (REIT) are a little more up your alley, then, you can expect a yearly return of 10.06% from your initial capital.

What makes this such a promising route to take is that buildings, homes, and even recreational establishments like malls and parks will always be part of society.

Depending on location, real estate investments are one of the safest bets you can work toward. We will always need spaces for shelter, functionality, and leisure.

The truth is, you can rarely go wrong with real estate if the best investments for regular cash flow are what you aim for.

2. Dividend stocks

    Best Investments for Cash Flow | VI College

    We’re all familiar with what stocks are, but what are dividend stocks?

    A dividend is the issuance of shared corporate earnings to eligible investors and shareholders. A company’s board of directors typically determines how much dividend payments can cost, although a large portion of this amount is reliant on company performance, too.

    In other words, dividends are essentially the percentage you get back regularly depending on how many shares you buy as an investor. A lot of companies pay dividends, while many also just opt to retain earnings and invest them into other ventures within the company.

    Why are dividend stocks good cash flow investments?

    Because they guarantee returns. Here’s an example: say, you purchased a share from a company that issued a 5% stock dividend. This means it would bump the number of shares held by shareholders by 5%. To rephrase, you get an additional share for every other 20 shares you buy. So if you bought 100 shares, you’d get 5 extra shares.

    You can either choose to take your earnings in cash or simply reinvest your dividends to acquire even more shares in the future. The more stocks you have, the bigger your earnings are.

    A fascinating example here is the mega beverage brand Coca-Cola.

    Let’s go over real numbers: if you invested a thousand bucks in Coke in 2009, the shares you’ve acquired would have cost over $2,800 in Q1 of 2019. This also means that for every Coke share you acquire today (August 2022), you get an annual dividend yield of 2.71%. In other words, for every share you own at $64.88, you’re guaranteed a return of $1.76.

    This is a terrific option for investors who are in it for the long haul. If you’re looking for cash investments that allow you to easily scale up or double down, dividend stocks are the way to go.

    Unlike real estate assets, stocks are more volatile and investors have full control over what they choose to hold, buy, and sell. You also won’t need a whole lot of money to start investing in dividend stocks.

    What you’ll have to remember here, however, is that it can take a while for you to notice a capital increase—although this also depends on how many shares you’re willing to buy and what a company’s dividend yield is.

    3. High-yield savings accounts

    As the name suggests, high-yield savings accounts are savings accounts that promise a good amount of interest, worthy enough to entice consumers to keep their money stashed up in a specific bank.

    As of August this year, a high-yield savings account can earn around 1% annual percentage yield (APY) compared to the national savings average which is less than 0.15% APY.

    If we’re talking about specific numbers, your $10,000 can garner a little over $100 a year. This is assuming that the high-yield savings account’s APY is steadily 1%. A hundred bucks may not sound like a lot, but when you compare it to an average savings account in which ten grand can only make about 10 bucks after 12 months, then $100 does sound like a way better deal.

    In this context, you have to remember that APYs can change. Sometimes for the better, and sometimes for the opposite. Even then, plenty of banks today guarantee a whopping 1% to 2% APY.

    Financial literacy calls for a lot of monetary preparation, and doing so means storing your funds in platforms that allow your finances to grow. Ultimately, this route is best for investors who need money saved up somewhere that they can easily access. Think of this strategy as a means to build emergency funds too.

    Furthermore, unlike many average savings accounts, high-yield savings accounts typically have a sizeable initial deposit and minimum balance requirement.

    If you have a good amount of money you’re not quite sure where to invest yet, putting your hard-earned bills in a high-yield savings account looks like a wise decision.

    4. Rentals and traditional businesses

      Best Investments for Cash Flow | VI College

      A list of the best investments for cash flow would not be complete without mentioning rentals and traditional businesses.

      It’s true when they say that to be rich, one must venture into business. Although it’s fair to argue that businesses now come in a variety of shapes, traditional businesses like laundromats, coffee shops, and service agencies often always promise regular income.

      Granted that you have to keep braving a series of challenges when you run a business, solutions that add value to consumers’ lives are never a bad thing to explore.

      What you’ll have to consider here, however, are the competencies and interests you’re willing to stress over. It’s no secret that businesses take a lot of work, so if you’re building a business from scratch, you’ll have to be ready for the legwork and mental labour that come with establishing a brand and bridging gaps.

      Rentals are a superb way to generate passive income as well. There are many routes you can explore here. For instance, if you’re a huge concert enthusiast, buying sound and light equipment to rent out to bands and organizers is one way.

      If you have access to a reasonable number of vehicles, then building a car rental agency can be a wonderful way to earn money too. Anyone with material privilege can bank on their resources and make substantial profits over equipment and services that continue to create demand. Whether it’s renting out computers, cars, or even props for film and move sets, the choice is yours.

      5. Affiliate marketing

        Best Investments for Cash Flow | VI College

        Affiliate marketing is one of the more challenging strategies to take, but if you have a solid following on social media, then capitalising on your influence can be profitable, too.

        For example, there’s a huge reason content creators encourage their followers to purchase items from links they share on online platforms. Commission-based advertisements and partnerships are fast becoming a demand, thanks to the rising cruciality of social media.

        If you’re a huge fan of podcasts and YouTube videos, then there’s a high chance you’ve heard your favourite internet celebrities promote a brand or service with a unique code they endorse in the end.

        To simplify, affiliate marketing is when retailers commission professionals and providers for sales-generated referrals and purchases.

        This can take the form of plenty of things, too. If you manage a blog, you can either hyperlink products that lead viewers to a landing page or you can also whip up an advertorial that discusses a brand’s commodities.

        Some of the biggest names in the business that make great use of affiliate marketing are no-code website-makers Squarespace, internet service NordVPN, and the e-learning platform SkillShare.

        What makes this strategy an awesome money-making solution is that you exert effort usually just at the onset of the project and leave your digital outputs to do the work.

        If you host a YouTube channel, for example, you can simply link a product in the description box, publish the video online, and wait for your subscribers to start patronising whatever it is you advertised on the video. If links to these products remain the same for long periods, then you’re most likely to keep earning from these clicks and purchases long after you’ve released a video.

        This is why websites that produce a whole bunch of listicles are highly bankable now because it doesn’t take a lot of energy to round up a list of best-selling products and items. And every time a reader comes across these lists and buys from your recommendation, you’ve already made a sale.

        All in all, the best investments for steady income are ventures you’re comfortable seeing through. There is no one-size-fits-all approach to investments, so strategies you’re willing to put up with and goals you’re determined to achieve should help you decide which way to go.

        Do you want to find out how you can make promising investments? Click here!


        This article and its contents are provided for information purposes only and do not constitute a recommendation to purchase or sell securities of any of the companies or investments herein described. It is not intended to amount to financial advice on which you should rely.

        No representations, warranties, or guarantees, whether expressed or implied, made to the contents in the article is accurate, complete, or up-to-date. Past performance is not indicative nor a guarantee of future returns.

        We, 8VI Global Pte Ltd, disclaim any responsibility for any liability, loss, or risk or otherwise, which is incurred as a consequence, directly or indirectly, from the use and application of any of the contents of the article.