2024 is another year any financially aware person should prepare for in terms of investments. But here are the facts:
- The crypto and blockchain market will boom due to their increased relevance
- Inflation rates will continue a steady decline, according to the IMF
- Interest rates might remain the same at the least, as there are signs that they would reduce.
With the above in mind, here are five investment opportunities to consider in 2024.
Cryptocurrencies
Cryptocurrencies are here to stay. Although the market is volatile, 2024 might come bearing gifts for cryptocurrency investors.
The recent economic conditions have seen investors considering hedging inflation with crypto. With blockchain technology evolving to solve efficiency, security, and scalability issues, crypto is
fast becoming an essential part of the modern-day application. There is a growing need for them, pointing to investment in a revolutionary crypto project by 2024 as a smart choice for people looking to profit.
For instance, Bitcoin’s past data shows it experienced significant gains after major downturns. When Bitcoin prices dropped by 61% in 2014, it later picked up about 35% increases in the following three years. The trend also presented in 2018 when the coin experienced a 73% price decline in 2018, which was followed by three consecutive 60% annual gains in the following years.
Bitcoin halving is another major event that may trigger a Bitcoin gain in 2024. Bitcoin halving is an event that occurs after 210,000 blocks on the blockchain are mined. It results in a 50% Bitcoin mining reward reduction. So, after a Bitcoin halving event in 2024, the normal 6.25 BTC reward for mining a block will drop to 3.125 BTC.
Following a bullish 2022, a 2023 recovery, and a Bitcoin halving event set for April 2024, 2024 might be a good year to invest in Bitcoin.
Real Estate
In the past year, interest rates skyrocketed due to various economic constraints. However, as we approach 2024, the inflation rate might reduce, prompting the Federal Reserve to reduce the interest rates. This might be your cue to invest in real estate in 2024. Nonetheless, even if interest rates remain high, people are beginning to adjust. So, we might see an increase in transaction volume.
You can get involved in real estate via various channels. For instance, you could buy multifamily properties that need renovations, renovate them, and resell them for profit. This is known as rehabbing. Regardless of inflation, tenants still need high-quality properties matching their satisfaction. You could also hold these properties for extended periods to generate income from rents and appreciation.
Another aspect of real estate investment that is often overlooked is land acquisition. There is a need for more ready-made properties. Acquiring lands in promising areas might prove beneficial when opportunities to build new properties arise.
Real estate investments have been touted as one of the most profitable and popular ways to build wealth for ages. As ever, they require proper knowledge, skills, and strategies. The point is knowing your options and choosing the best one based on your resources and investment goals. To get that correct, you need to invest in your real estate education and learn from the experts in the space.
Stocks
Despite this year’s high inflation rates, Standards and Practices (S&P) 500 experienced a 16.1% value increase, while NASDAQ rose by 35.4% in the first three quarters.
It gets even better as recent developments point to an even better possibility in 2024. We see some growth in the US job market and moderate wage growth. Analysis shows that S&P 500 companies might experience a 12.2% earnings growth and a 5.6% revenue growth in 2024. And this growth is likely to spread across all sectors. Jerome Powell, the Chair of the Federal Reserve, announced in August that they would proceed with caution, thus signaling that the interest rates might reduce in 2024.
And you know what that means.
The borrowing costs for consumers and businesses will reduce, thus increasing spending and investments and ultimately raising stock valuations. In addition, considering the U.S. economy has prevented a recession despite the aggressive interest rate hikes, 2024 might come with slowed-down economic growth. Still, it is unlikely that it will turn negative.
Should this happen, it’ll keep consumer confidence up and prevent a sharp drop in corporate earnings. A mix of both conditions could drive up stock performance.
Consider getting a piece of the action in 2024.
Mutual Funds
Mutual funds are a solid option if you’re looking to diversify your investments in 2024 without becoming a financial expert. These funds pool financial resources from investors like you and invest in securities like stocks, bonds, and other money market instruments.
Against 2024, you can check out some quality mutual funds like Capital Group Dividend Value ETF (CGDV), Columbia Dividend Income (LBSAX), etc. These and many more mutual funds invest in opportunities like large-cap US stocks, emerging US companies, etc.
In addition to diversifying your portfolio, investing in mutual funds gives you access to professional management, thus limiting the loss probabilities. Nonetheless, all investments are inherently risky, so endeavor to tailor your investment strategy to your achievable targets and spare resources.
Roth IRA
The IRS recently announced new income limits for Roth IRAs (Individual Retirement Accounts) ahead of 2024. And if you haven’t already started investing towards retirement, these new limits are good enough to change your mind.
Individuals who aren’t within the Roth IRA income range, take a second look, as the income range will go up to $146,000 from $138,000 back in 2023. If you’re 49 years old or younger, you can potentially save up to $7000 in a Roth IRA per month. The good thing about it is that you get to create a larger pool of tax-free money for yourself in the future.
And for individuals whose incomes are still above this bracket, the options of contributing to traditional IRAs and converting to a Roth IRA after the fact still exist.
Conclusion
Considering 2024’s financial projections, investing in cryptocurrencies, real estate, stocks, mutual funds, and, more importantly, your retirement through Roth IRA makes sense.
However, as you do this, remember that past occurrences do not guarantee future performances. So, do your own research (DYOR) as we approach 2024.
