5 Alternatives to Investing in the Stock Market

5 Alternatives to Investing in the Stock Market

While stocks would be the cornerstone of the American investment experience, not everybody is interested putting everything in to the stock market. Indeed, it will make sense, depending in your preference and your risk tolerance, to look for alternative investments.

If you should be considering other areas to invest your cash, here are 5 alternatives to stock market investments:


When you aren’t planning on purchasing stocks, among the time-honored alternatives is bonds. You are able to keep your principal (relatively) safe with bonds, and earn interest.

Many investors turn to government bonds in times of economic uncertainty, as they are considered the next best thing to a “sure” thing. If you’ll need a higher yield and are willing to defend myself against a tad bit more risk, you are able to consider emerging market bonds.


Yes, we’ve heard a lot about how precisely annuities could be a nightmare — and let me tell you they can be. However, there are some annuity products on the market that aren’t so bad.

With the best annuity, you are able to arrange for regular, reliable income (assuming you trust the insurance company selling the annuity). Your investment won’t see a lot of growth, but it will enable you to receive a typical chunk of income when you’re ready for it.

When you invest in an annuity, though, do your homework. Annuities are noted for fees, as well as for beneficiary snags and potential tax issues.

P2P Loans

An increasingly popular investment option is P2P (peer-to-peer) lending.You need to use P2P lending as a means to earn interest on your cash — and usually at a better rate than bonds or cash.

In some cases, particularly during an economic downturn, annualized returns from P2P loans will even beat stock market returns.

However, you still run the chance of loss. If the borrower defaults on the loan, you can lose your principal. But with only a little careful probing, it’s possible for you really to find solid prospects for the P2P portfolio.

And if you wish to help others while earning a return on your cash, you can consider microloans to those in third-world countries who are trying to start businesses to raise themselves out of poverty.

Real Estate

You will want to invest in something you are able to touch? You can purchase home and hold onto it, hoping to offer it for more later (a strategy my grandfather employed to great success when he sold to developers after 20 years).
Another strategy is to purchase income property. You can get property made to offer you regular income from renters. In either case, property could be a solid alternative to the stock market — when you can handle the management aspects.


Among the most popular alternatives to the stock market is gold. When you invest in physical gold, you not merely have something tangible, but you might also need something which nearly every culture has considered valuable for thousands of years.

In a touch, you need to use your gold as currency in a few places. You are able to hoard it and watch for the dollar to collapse (if you think that’s what’s coming).

As long as you understand how to counteract a number of the difficulties of purchasing physical gold (where to store it, etc.), it could be a fine choice for some investors.