If you don't invest in stocks, what should you invest in?

[dalej42]

@Yllaria

I didn’t notice money market accounts listed in the responses so far. Forgive me if I missed them. They’re less risky than stocks and usually make a little more or less than 4%.

Not with today’s interest rates.

[Spoke]

@Exapno_Mapcase

This points up the need to research your subject. What you say is true, but the real lesson to take away from it is that the only comics who have that sort of value are the old comics that remain in near-mint condition.

No, it is not only near mint comics that have held their value. Golden Age comics (1930s to early 50s) in all conditions and Silver Age comics (1950s-60s) in fine condition or better have appreciated very nicely over the years. I merely cited Action Comics #1 as an eye-popping example.

Later comics were often hoarded by collectors and consequently have not held their value as well. There are just too many of them available.

But I would say that comics of any age are not a good investment now, for reasons I have already given.

@friedo

Clearly the solution is to raise enough capital to buy a $1.3 million comic book, then resell the individual pages for a profit. You know, like condos.

No, no. No need to physically parse the comics. The real trick is to sell shares in the more valuable comics. Shares that can be traded and re-traded. And sold on Wall Street, or to European bankers. Yeah, that’s the ticket! Comic-book-backed securities! What could go wrong?

[cletus]

If you don’t want to deal with stocks then your biggest problem becomes inflation risk. Inflation usually goes up every year which basically means your money is worth less and less over time. I believe inflation has averaged ~3% over the last 15 years. You need investments which will keep up with inflation just to break even.

The government offers TIPS bonds which are bonds indexed to inflation. For the average investor you would be better off investing in a TIPS mutual fund which is more liquid. I recommend a mix of TIPS and intermediate term bond index funds with Vanguard.

However, I have some bad news for you. TIPS alone will not be enough because you will have to pay taxes on your gains. The only way to beat inflation is to take on more risk in return for greater yield. Many other posters keep recommending stocks for a reason. They are relatively easy for your average person to understand and participate in while also offering more yield then government bonds. The downside is… will I guess I don’t really need to get into it for obvious reasons. Another investment easy for the average person to get into would be owning a home (real estate) but that hasn’t been working to well right now either.

If you want low risk then the tradeoff is more time. You need more time to let compound interest work its magic. Remember also that you still need to beat inflation every year.

*By average person I am talking about those people who don’t have the ability or the large amount of time necessary to devote to learning about more complex financial instruments.