2020 was a rather harsh year for nearly everyone. That’s not an understatement. However, despite how shockingly awful 2020 was in many ways, 2021 will likely be an up year comparatively thanks to introducing vaccines to fight the pandemic that will most likely lead to rapidly recovering markets. There’s an excellent chance there is a lot of money to be made by getting into the right investments now while the market is down. Don’t let these opportunities pass you by. Below are some tips and tricks to use to invest wisely in 2021.
Take Advantage of the Low-Interest Rates
You should be very aware that the Federal Reserve has indicated that it will keep interest rates very close to zero until the year 2023 to help the economy recover from the pandemic.
Indeed, take advantage of this fact in regards to your investment choices. Low-interest rates are a suitable environment for growth based assets like stocks due to the lower interest payments. In that regard, lower interest rates lead to increased profits. Stocks that are likely to perform well in a low-interest-rate environment include dividend stocks, utility stocks, property stocks, gold stocks, and infrastructure stocks.
Start a Limited Liability Company
While quarantines may not seem like a good time to start a new business, the lockdowns will eventually be lifted as the vaccines are rolled out, and a larger portion of the population becomes immune to the virus. As such, it may be an excellent time to start planning now for the eventual launch of a new business. That way, you can cut to near the front of the line regarding benefiting from a rapidly improving economy thanks to more people again being able to perform typical consumer behavior and business transactions.
Consider founding an LLC, a limited liability company. An LLC combines the best benefits of sole proprietorships and partnerships with the increased legal protections of corporations. Such a structure can allow you to seek out your entrepreneurial dreams while protecting your assets.
Use Your LLC to Make Wise and Legal Investments
You can certainly do with your new LLC to make a wide variety of different business investments to take advantage of improving economic landscapes. However, administrating those investments through the complex structure of an LLC can be tricky. Make sure to get help where you can get in regards to KYC (know your compliance). Use an outside firm that can grant you access to software solutions that provide KYC functions. This software will help ensure that you are adhering to all the LLC business structure’s compliance regulations for your different investments. Look for useful features in such a software solution, such as real-time monitoring for money laundering. Such a feature can help ensure that all your business transactions under your LLC are above board and that you can produce a healthy return on your investments without running afoul of the relatively dense legal code regarding LLCs.
Consider Starting an HSA
One thing that people will undoubtedly be more tuned into in 2021 is their health status. You can be more mindful of your health while benefiting from an investment into it by starting an HSA, health savings account. If you have a high deductible healthcare plan, as many people do, you will be eligible to start an HSA. While such an account may seem only to be a way to save for future unexpected medical costs, this is not true.
The exciting thing about an HSA is that you can also use the account to save for your retirement. While the money placed into it is taxed, the funds within the HSA grow tax-free with a rollover over. The money that is withdrawn from the HSA will not be taxed when you use it to pay for different medical costs. The funds are not tied to an insurance provider, and you can keep using them after changing insurance plans.
While 2020 was a rather negative time for many, you should be more optimistic about 2021. The bad times can’t last forever, and you should take advantage of that with your investments. The options above are only a starting point for all the different excellent investment choices you could make in the upcoming year. The future is far brighter in 2021 than you may realize.
