10 ways to grow your money online.

This is a list of the 10 best ways to invest your money online:

1. Peer-to-peer lending – The popularity of crowd funding websites or peer-to-peer lending has grown substantially over the last couple of years. You can use websites such as FundingCircle, Zopa and MoneyandCo to borrow money to individuals and emerging companies.  The  rates received for your money invested range between 5% and 15% depending on the risk you want to take.

2. Equity lending – Alternatively, websites like CrowdCube and VentureFounders allow you to buy equity or a stake in peoples growing businesses and thus you essentially become a shareholder and receive dividends. CrowdCube lets you invest in a business for as little as £10 pounds

3. Buy property – You can now buy a share in a property online for as little as £500 Websites like HouseCrowd and PropertyMoose allow you to buy a share of a property you are interested in. The property is bought under a single purpose vehicle and you become a shareholder in that company. The advantage of this is that the company takes on no debt so even if the website goes into administration, it will not affect your investment in the company.

With the above three, they are not covered by the Financial Services Compensation Scheme(FSCS) and thus there is no protection of money invested. As a rule of thumb, don’t invest more than 10% of your savings in non-regulated types of lending.

4. Buy company bonds – Big businesses require finance and what better way for you to invest money than to buy bonds which pay you a fixed amount over the life of the bonds. You can use websites like HargreavesLansdown to buy bonds from big established businesses or you could use CrowdCube to buy mini bonds in up and coming businesses. The CrowdCube option is more lucrative as it offers higher rates of interest but the risk is also greater as most are up and coming businesses.

5. Put money in a savings account – This is the safest of all options but your return is really low averaging about 2% in the current climate. But your savings are protected by the FSCS and thus any savings up to £80,000 are protected. You can put £15 000 of your savings in a NISA to save tax.

6. Buy premium bonds – With the NS&I, you can buy premium bonds online. The bonds do not pay any interest but there instead the bonds go into a prize draw every month for you to win a number of cash prizes.

7. Trade currencies online (ETORO) You have heard many stories of people making quick money in currency trading. Well this is true but you also have to have a very analytical brain to do so. One way of overcoming this is by signing up to a website called ETORO . This website allows you to copy other peoples trades and thus essentially you can grow your money by just selecting the right traders to copy. This is also helpful if you want to learn how to trade currencies as you can see why people are buying and selling certain currencies.This platform also allows you to trade certain commodities like gold and oil online as well.

8. Buy Stocks online – you can buy stocks from individual companies online. This is riskier than buying an ETF(see below) but the potential rewards are also far greater. The cheapest places to buy stocks are iWeb and YouInvest.

9. Buying an Exchange Traded Fund(ETF) or Mutual fund – When you invest in an ETF you invest in a wider range of stocks whose aim is to mimic the performance of a particular market or index such as the FTSE 100 and like a traditional tracker their value is determined by whether or not the index rises or falls. Buying ETF’s is my advise as it allows you to diversify your portfolio and spread your risk. ETFs are likely to increase your money at a steady rate every year. You can use websites like Hargreaves Lansdown or Fidelity to buy bonds. An even easier way to diversify your portfolio is to use nutmeg.com. I personally use this website as it is easy, transparent and low cost. Nutmeg allows you to chose your level of risk depending on how long you want to invest for. See my review of nutmeg here.

10. Start a trade – this is probably the method which involves the most effort and hard-work but could prove to be the most lucrative. With a normal brick and mortar trade on the high street, your potential customer base is at most 100,000. But online, this number increases significantly. It is definitely harder to establish yourself online as there is more competition but it is also cheaper to trade online using websites such as Ebay.

The trick in this is to find a niche or gap in the market you think you could target.When selling online, you need to follow one of two rules. You have to either sell your product for the lowest price compared to your competitors or secondly, you need to differentiate your product thus being able to charge a higher price.

Please leave comments in the section below if you have any alternative ways or websites to invest money online and make good returns.

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