10 Best Income Producing Assets to Grow Wealth

Have you ever wondered what separates the wealthy from others? It is not a magical book, a secret code, or inherited genes, but rather planning, strategy, and a willingness to step outside of the comfort zone.

You must be unbiased about your budget and the viability of your plan. In this article, we will discuss 10 income generating assets that will help you get there faster.

About Income Producing Assets

Many people are scared to face the unpleasant realities of their finances and long-term prospects, rendering any planning and strategy pointless. Several things can help you reach financial freedom; passive income ideas, getting a raise, side gigs, owning a business, and owning income producing assets.

Creating multiple income streams with your own money, time, and energy, on the other hand, can be extremely taxing. First and foremost, concentrate on developing a solid financial plan and increasing your primary source of income.

Create and stick to a reasonable budget. Prioritize rainy-day savings, beginning with low-risk instruments such as a high-yield savings account or index funds.

1. In-Demand, High-Value Skills

Before you dive into creating many different income streams, sacrificing your time, energy, and money, you should focus on growing one primary income first and having regular raises over the years. This is the most stable and proven, not to mention a comfortable way to boost your savings accounts significantly.

The best income producing assets are highly valued, specialized, and in-demand, future-proof skills that you learn. These, ideally related to your primary field of employment, can make you wealthy as a highly-skilled employee, consultant, or entrepreneur.

Some of the highest-paid fields are big data, automation, programming, machine learning, algorithms, search engine optimization, growth hacking, and business analysis.

2. Cryptocurrencies

Cryptocurrencies are on the rise for nearly a decade now and there seems to be no limit. Bitcoin comes closer to the $100,000 level instead of disappearing. The first crypto-ETF was launched in 2021, more and more businesses accept crypto payments, and the more stringent regulation opens the door for a broader use of cryptos.

There are plenty of opportunities making money with trends like this. First you analyze what people are searching for and what they need. Then you can create a solution for their needs. That can be help-guides, tools, online platforms like forums or so many other things. A good way to start research is by looking at Reddit forums. Creating a business around cryptocurrencies can become a long-term steady income producing asset. Alterantively crypto mining in countries with low prices for energy can be profitable too.

3. Dividend Paying Stocks

To build wealth, you need to invest money, and use compound interest. An investment portfolio as a passive income generating asset is one of the most popular ways to build wealth.

There are seemingly infinite amounts of dividend paying companies on the stock market, but you must learn to pick the healthy and prosperous ones.

If you lack the necessary skills or time, it’s best to choose the best performing exchange traded funds (ETFs) that invest in dividend stocks or index funds and do the majority of the work for you.

4. Mutual Funds

Mutual funds are considered safe income producing assets with a diversified portfolio. Many investors prefer index funds, but actively managed funds that pick individual stocks and bonds are also available.

A mutual fund typically invests in publicly traded companies, whereas private equity funds invest in privately-held businesses.

The minimum investment amount for mutual funds is low and similar to ETFs, you can flexibly re-allocate your assets. Still, most investors consider ETFs the better alternative to mutual funds.

5. Real Estate Investing

Real estate can be risky income producing assets, but with thorough planning, it’s still one of the most lucrative passive income opportunities. Whether it’s commercial real estate or owning rental properties, real estate investing plays a significant role in generational wealth creation.

It’s also possible to turn it into a passive income source by choosing real estate investment trusts (REIT), that is similar to a mutual fund, and offer a significantly high dividend yield, even in the years to come.

Also, real estate crowdfunding is an excellent option for small investors seeking a passive income stream to invest in real estate properties. In exchange for a small share of the profit, these are funded by a large group of investors who do not actively participate in property management.

With paid property managers, you can turn multi family properties, trailer parks, Airbnb vacation properties, or basically any rental property into a source of passive income.

Some of these businesses provide such complex services that you only need to collect a check. It all depends on how much you are willing to pay in fees to them. Nonetheless, it is important to review any potential investment carefully to avoid investing in the risky ones with low profit potential.

6. Online Business

Creating an online business, like any other company, requires a significant amount of work upfront, but it can generate consistent passive income for many years afterward.

You can make a lot of money by creating websites and selling them, as well as selling ad spaces or sponsored content on them.

Niche websites with high-quality and SEO-optimized content have the best chance of becoming a great income producing asset.

The most common way to supplement your savings account with continues growth is to build a blog, drive traffic, and profit through affiliate marketing.

Selling on Facebook Marketplace, creating and leveraging an online directory, and providing subscription-based online services have all been booming in recent years, while dropshipping is not that popular anymore.

Selling digital products like music, videos, apps, or online courses can generate surprisingly good income streams.

7. Profitable Assets

Physical or intellectual properties that appreciate over time can be the most profitable assets. Art, wine, and spirits, cool things to collect domain names, and even a great passive income portfolio are some examples, that are well-worth saving money for.

The idea is primarly to buy such assets and sell them later at a higher price. That can mean that you hold them for the mid- or even for the long term before you can realize your profit.

For example, if you bought a Rolex 10 years ago, then the price meanwile nearly doubled. But it did not double only because of the willingness of people to pay more for such a collectible, also the list price went up significantly. Keep in mind the value growth should be higher than the inflation.

8. Buying a Company

Buying a company is usually a lump sum investment, and can be intimidating at first. It requires skills and a basic understanding of business finances. These can be learned properly with willingness and enthusiasm.

You can invest in a company, large or small, in a variety of ways, including becoming the sole owner and operator, the owner with management in place, a silent partner, or an angel investor.

Taking on more risk usually means earning more money, so crowdfunding can be a safer option for accumulating wealth through company acquisitions.

Any traditional brick and mortar business is excellent for wealth creation, particularly in essential industries such as pest control, healthcare, electrical utilities, grocery stores, and food establishments that consistently generate cash flow and produce income in the long run, even in down economies.

9. Lending Stuff

Lending your stuff is a very simple way to generate recurring cash flow. This basic strategy is used by some of the most profitable businesses.

These income generating assets can be physical like self-storage facilities, food trucks, 3d printers with print-on-demand service. You can lend lands, farmlands, cars (vintage, nuptials, movie sets, limousines for parties and proms), high-end clothes and handbags, parking lots, bicycles, trailers, industrial machines for contract manufacturing.

You can also lend money for interest, and peer to peer lending is an advanced and secure method of doing so.

10. Royalties, Patents, and Copyrights

For decades, owning patents, copyrights, and collecting royalties has been one of the best ways to generate income, build wealth, and boost your savings accounts. As an author, you can create and sell ebooks, as well as buy and sell movie rights to books.

Creating a franchise, then selling or lending the rights to it, or buying one, is a tried-and-true way to go from middle-class to billionaire in a single generation. These franchise rights can be associated with books, restaurants, movies, or any other business model.

As a photographer or graphic designer, you can sell or lend your photos and designs online, as well as sell stock photos and templates. You can start growing your brand by pubishing photos in free databases. This way you don’t make money at first but once your brands grew, your sales will do too.

Owning mineral rights can be very expensive, and it is usually a field reserved for the wealthy. But if you can get your hands on them, with the help of investors, you can make a small fortune in a very short period of time.

Other Income Producing Assets

After acquiring a basic income producing asset and having a consistent monthly cash flow feeding your savings account, you can diversify your portfolio by trying other opportunities.

Many wealthy individuals began their journey by owning vending machines and ATMs. These are relatively safe and well-known methods of making a lot of money without putting in a lot of effort.

With innovation come new opportunities, such as NFTs, which are modern works of art that can be invested in, peer-to-peer lending sites, and startup crowdfunding.

The opportunities seem endless and you dont have to re-invest the wheel. There are great free videos out there on YouTube to gain further ideas. At the end its similar to any type of investment. You should come up with a business plan before you get into income producing asset investments. This way you ensure the chances of high profitability. If something looks to good, it most likely is. If something seems to be too risky and unprofitable, it most likely is. Use common sense to make the right decisions.

Conclusion

We’ve discussed some of the best income-generating assets, but they won’t get you very far unless you have a long-term personal finance strategy, some learning, and do your homework before you start investing.

The first step toward financial freedom or generational wealth is to create a budget in which you record all of your expenses and sources of income.

Establish long-term financial objectives for one, five, and ten years. Set goals for yourself, such as buying a house, finishing a degree or getting another one, starting a family, or pursuing hobbies.

What kind of life do you want to live in the next ten years that will make you happy? Are your expenses and income in line with your plans, or do you know how much extra money you’ll need to make them a reality?

If your cash flow is adequate for your plans, your primary goals should be financial stability for retirement and generational wealth building.

If your current income and expenses do not match your long-term goals, your first priority should be to save at least six months’ worth of expenses. Following that, you can determine how much more is required to carry out your plans.

Facing these numbers may seem intimidating at first, but with a plan and a strategic approach, financial independence is closer than you think. Knowing how much extra money you require is a great place to start.

About the author: Alexander is the founder of daytradingz.com and has 20 years of experience in the financial markets. He aims to make trading and investing easy to understand for everybody and has been quoted on Benzinga, Business Insider, Investors Business Daily, Newsweek, GOBankingRates, capital.com, investing.com and other top financial publications.