CNBC cites a survey by Bankrate.com which asked 1,000 investors what was the best investment for money to be left for a decade or more. Top answer was real estate, chosen by 27% of the respondents. This is the first year in three that real estate was the winner.
What's really weird is that the winner in the last two years was cash, and cash was a close second this year too. Almost the same number of persons polled this year felt that something that was close to guaranteed to lose value was a better investment than real estate. Further down the list of responses were stocks and bonds, surprising to me since both have had records of fairly consistent long term gains.
Residential real estate is a good investment if you consider that it will give you and your family shelter from the elements, and will also add a few other life style benefits. That can't be said for cash or securities. Beyond ones personal residence, there are some advantages in real estate investment, including but not limited to tax benefits, possible appreciation, and ability to leverage a small amount of assets via long term financing. All the advantages are balanced with like amounts of risk.
But then there's what many perceive as an alternative, cash under the mattress. How so many people who call themselves investors can claim that cash is a good investment is a mystery to me. The answer was not gold or treasury bonds, but cash. I always felt that cash is what you use when you invest, it's not itself an investment.
Can anyone explain how cash can be considered a good long term investment?