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Investment Vehicles: The Means of Getting Money through Your Investments


June 14, 2021

Harsha Moole, M.D., MBBS


One of the goals of investment vehicles is to enable investors to receive a return on their investments. The investment vehicle is a term used to refer to the products investors use to gain positive returns. It includes the different methods used by individuals and businesses to invest and build their income.

Investment vehicles are the means of getting money through your investments. These means are meant to drive you to your investors. Investors give you the ability to invest and watch your money grow.

Usually, there is a wide range of investment vehicles which you can choose from. Investors can also decide to hold at least several types of investment vehicles in their portfolios.

Investment vehicles can be seen and touched. Mostly, they are usually non-liquid. It involves replacing your control over cash with something known as investment. These investments are also risks and sometimes, investors may end up losing a part of it or the entire investment.

Why Physicians Need Investment Vehicles

Physicians like everyone else need investment vehicles to provide financial freedom without them having to depend on only their paycheck. This is because the right investment can provide the kind of comfort wealth gives without going through the stress of a 9-5 job. Being a professional physician does not guarantee that one would make swift and fast investment decisions.

Physicians are more likely to make bad investment choices especially in cases where money is lost at work. These decisions are often going to be blinded by arrogance, ego, and greed as against normal human sanity. To enable a physician to make the right investment choice, he/she must first identify their needs and goals and then work towards achieving them.

Investment Vehicles

Different Types of Investment Vehicles that Physicians Can Take Advantage of

Not every investment vehicle is available to everyone. Some are best suited for people in a particular field. The goal of some of these investment vehicles is that physician investors can find the right investment vehicles that would help to speed up their journey to financial success.

A lot of physicians start building their personal, financial, and professional careers late with a lot of debt involved. This is as a result of the number of years it takes to become a qualified physician and student loan debts collected within this period of studying.

An average 30-year-old physician would still be getting started on building wealth and sometimes with a drastic, negative setback. However, with the right type of investment vehicle, physicians under these categories can still build an amount of wealth and security that enables them to make great wealth.

There are various types of investment vehicles that physicians can take advantage of. They include:

#1. Real Estate

Real estate is one of the direct ways to invest and grow your money as a physician. Over time, the value of land keeps increasing.  This is one of the reasons why real estate is known to be one of the best forms of investment. For any Physician who is seeking a means to financial freedom, real estate is just what you are looking for.

Investing in real estate is not limited to just purchasing your home. It includes a variety of other activities like buying rental properties, house flipping, wholesaling, crowdfunding, Real Estate Investment Trusts, etc. One of the best parts is that it involves less risk than other investment vehicles, especially for someone with little or no knowledge of how it works.

Over the years, real estate investment whether on a small or large scale is a tried and true means of building an individual’s cash flow and wealth. Real estate could be for personal or commercial use. It is often more expensive and complicated than other forms of investment. Real estate also involves less volatility and consistent appreciation of returns.

#2. Bonds

Bonds are known to be a form of debt owed to investors. These bonds are issued to investors with a promise to pay a specific amount of dividends and the principal at the end of the agreed period. Bonds could be issued by either the government or a corporation. Bonds issued by companies are done to assist in raising money to help fund projects. It is known to have the listed risk from other types of investment vehicles.

#3. Stocks

Stocks are similar to the ownership of shares in an operation or the company itself. To reduce the risk involved in owning shares, it is advisable to buy different shares from different companies. This is usually referred to as diversification of portfolio.

Companies issue stocks to shareholders as a means to raise revenue for the company, fund projects, and initiate business expansion. The shareholders are those who own various stocks in different companies. One of the benefits of being a company’s shareholder is that such a person takes part in the decision-making of the company and they also get to receive dividends from the company. Dividends refer to the amount paid out to all shareholders by the company on either a yearly, monthly, or quarterly basis.

#4. Mutual Funds

Mutual funds work by allowing investors to pull their resources together to invest in stocks, bonds, commodities which they couldn’t do individually. These funds are usually managed by a professional money manager who applies the principle of diversification over a range of investments. These financial managers also help decrease the risks involved and increase the return over time.

#5. Cryptocurrencies

Cryptocurrencies like a new child in the block have caused quite a sensation in the investment world. Cryptocurrencies are digital currencies that are based on blockchain technology. Physicians can bug these currencies and hold them until their values appreciate, before selling to make a profit. Cryptocurrencies are however very volatile and may not be ideal for conservative investors. However, it has proven to be a good way to build wealth.

#6. Angel Investing

You can take advantage of angel investing and buy into startups with good prospects. Through angel investing, investors are connected to people who have a business idea without the capital to push it through. What an angel investor brings to the table is the funds in exchange for a specified percentage of profit made from the business for a defined period.

#7. Partnership in a private company

Many private companies in a bid to carry out expansion plans may invite investors to partner with them. Through this partnership, a physician can gain a steady amount of cash flow without being directly involved in the business.

Characteristics of Real Estate

When compared to other types of investment vehicles, real estate is regarded as unique and one of the best means to financial freedom. The characteristics of real estate would help you understand why and how you should invest in it. They include:

  1. Promotion of generational wealth. This is important especially for persons who are concerned about leaving a source of income for their families as a legacy.
  2. Real estate enables you to leverage your local community and create a team to earn a highly profitable portfolio.
  3. Real estate is stable and can be easily sold out without a substantial loss in value.

Types of Real Estate Investment

There are different kinds of Real Estate investment vehicles that you can invest in building wealth over time. Some of these Real Estate investment vehicles include:

  • Commercial Real Estate: Commercial real estate is used for commercial and business purposes. It is the acquisition of properties to lease them out to businesses on lease.
  • Residential Real Estate: Investing in residential real estate can be in the form of the purchase of condominiums, townhouses, or any other firm or family house. It could be a single-family house or a multifamily house. A multifamily house usually is structured to accommodate more persons than a single-family house.
  • Land Real Estate: physicians can purchase land to develop it into rental apartments, or commercial buildings. These lands can also be leased out to industries for a specified period.

Conclusion | Investment Vehicles

Each type of investment vehicle comes with its own risk and benefits. A physician needs adequate knowledge of whichever vehicle he/she would want to invest in especially if he/she is inexperienced. Whichever it may be, the goal is to have a successful investment vehicle return. All it takes is a great investment vehicle strategy and a team to help provide the best investments.

When it comes to real estate, one thing you should understand is that the amount of money you are willing to invest can be determined by your comfort level. The main goal should first be to find a team that understands your needs and then you can start something. There are so many other ways doctors can penetrate the real estate world and build sustainable wealth. Find out here.

 

Here at PhysicianEstate, we welcome all physician entrepreneurs to learn about commercial real estate investments, rental property investments, and wealth generation. We encourage all physicians to eventually become real estate physician investors. We know a great deal about Who – What – Why – How. 

Stay in touch with us by signing up for our newsletter. The newsletter will keep you up to speed on the current real estate investments we are looking at, provide physicians with investment opportunities, and much more.  

Legal Disclaimer: This is not investment advice. I am not a legal and/or investment advisor. This is my personal blog, and all information found here, including any ideas, opinions, views, predictions, forecasts, commentaries, suggestions, or stock picks, expressed or implied herein, are for informational, entertainment or educational purposes only and should not be construed as personal investment advice. These are my views, it is not a production of my employer, nor is it affiliated with any broker/dealer or registered investment advisor. While the information provided is believed to be accurate, it may include errors or inaccuracies. To the maximum extent permitted by law, PhysicianEstate disclaims any and all liability in the event any information, commentary, analysis, opinions, advice and/or recommendations prove to be inaccurate, incomplete or unreliable, or result in any investment or other losses. You should consult with an attorney or other professional to determine what may be best for your individual needs. Your use of the information on the website or materials linked from the Web is at your own risk. 

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Authored by Harsha Moole, M.D., MBBS

Hey there! I hope you enjoyed reading this blog. PhysicianEstate is my brain child and passion project. I run this platform to empower entrepreneurially motivated physicians to make financially educated investment decisions and discuss asset protection strategies. Lots of important but free content here and here! If you have any questions or if you are interested in partnering with me, let’s connect! hmoole@physicianestate.com

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