Wise Bread Picks
When it comes to investments, the most popular asset classes are stocks, bonds, and real estate. However, in the recent economic turmoil many people are looking for alternative investments to maintain the value of their assets. Here are three long term "investments" that you could enjoy while you wait for price appreciation.
Art
In general, the world of art collecting is volatile and people's tastes change over time so it is hard to nail down what would appreciate. Also, most of us do not have thousands to millions of dollars to spend on art. So the best way to collect art is really to just buy the pieces you enjoy and could afford. There is no point in buying an abstract painting you do not care for just because it is by some famous dead artist. There are tons of galleries showcasing contemporary artists who sell their pieces at very reasonable prices. If you are looking for appreciation then it makes much more sense to buy the art before an artist becomes too famous.
Another way to invest in art is to find out what the tastes of the collectors are. For example, A particularly "hot" area of art is Asian art right now since the wealth of China and India ballooned in the recent years. Even in the economic downturn, top auction houses are getting bids over their estimates for Asian art. After all, the monetary value of art is fairly subjective, so if you really want to collect art as an investment then you need to follow the money. Otherwise it is best to just buy the pieces that make you happy.
Fossils
When I was a kid I collected fossils and minerals. My favorite piece was a small fossil fish that my mom bought for me for around $6. Apparently a similar speciment is worth 6 or 7 times more now because fossil collecting is gaining popularity all around the world. The price appreciation on that particular fossil has been more than twice of inflation. There are professional fossil hunters that search for rare speciments in exotic places like the Arctic and museum quality pieces could be worth millions. Fossils are fairly low maintenance compared to art and they are becoming more rare as more collection sites are becoming protected. Each fossil is also guaranteed to be unique, so that makes the collecting more fun.
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Books
I learned quite a bit about collectible books when I was selling used books. With the rise of digital media, I think real books will become more scarce and collectible as time passes. Although digital books are convenient, I find it more pleasurable to read and touch a tangible book. It is possible to collect quality books on a small budget. One famous example is that of Michael Hurley a postal worker who never made more than $25,000 a year that amassed a collection worth over $300,000 in 1984. Currently you are still able to find many first edition 20th to 21th century books at very affordable prices. Some of these can even be found at garage sales if you look hard enough. One book I recommend for beginner book collectors is definitely Book Finds: How to Find, Buy, and Sell Used and Rare Books by Ian C. Ellis (affiliate link).
Each of these "investments" require a lot of study and research just like any stock or piece of real estate if your intent is to make any money. Just like the more mainstream investments, there are scams and duds so you should start small. Although collecting these things seem frivolous, it is actually possible to make a profession out of any of these if you learn enough and love the field enough. What do you think? What is your alternative investment?
