There is a reason that financial services comprise a multi-billion dollar industry. Investing is a complicated process under the best circumstances. Even before considering the best investment strategy, investors need to decide their goals and the acceptable level of risk. The strategy for a long-term, low-risk portfolio would be very different from building one designed for risky quick gains. Whatever your investment goals are, here are some things to think about while considering adding farmland to your investment portfolio.
For some people, investing is as much about improving the world as it is about making money. In fact, our core focus here at FarmFundr is Leaving Earth in a better condition than when we found it! Farmland investors typically search for promising green technologies or solutions to human problems. With the human population slated to grow significantly through 2050, investing in food production can help you create both wealth and a feeling of giving back. Investing in farmland is a great idea for people who want to feel like they are part of a solution to a problem.
Like other forms of investments, investing in farmland is multifaceted. Funders can make large six to seven figure investments in major operations, or much smaller investments via crowdfunding to help agricultural companies operate. Those with larger amounts to invest may benefit from investing in multiple smaller farms or, if more control and higher return potential is desired, a customized farmland investment may be for you.
Risk is as much a part of investing strategies as the desire for rewards. Investing in a single farm might provide a greater stream of income if the farm is successful, but those wishing to mitigate risk may prefer to spread the investment over multiple farms. If it makes sense for you, consider dipping your toes in the farmland investment pool by taking fractional ownership in a farm.
There are many advantages to carefully selecting the kind of farm for investment. For example, what is the market like for that commodity? Is there high demand? Consider if the crop is used in multiple ways. Investors who are concerned about price impacts may want to focus on products that are less likely to be affected by inflation. Investors can also consider regional risks associated with certain kinds of farms.
We don't know much about the future, but we do know it is very likely that future humans will still eat food. That assumption of demand over the long-term can potentially make farmland investments stable for decades. Since the amount of land itself is finite, land generally appreciates over time. These and other factors make farmland an attractive investment for those building a nest egg for the future.
No matter your motivation, you can find the right farmland investment for your portfolio. With enough research, you can find a location, product, risk, and potential return to match other options. You will also have the satisfaction of knowing that you are helping farmers to feed our future. Get started by creating a free account and accessing available opportunities today!