20 Appreciating Assets to Build Wealth in 2023

Saving money is a great habit, but savings alone are not sufficient to build wealth over time. 

The secret to turning thousands into hundreds of thousands or even millions is to take those savings and buy a handful of appreciating assets. These are vehicles that either generate a steady stream of cash flow or increase in value over time.

In this article, we will be analyzing the best appreciating assets that investors can choose to put their money to work.

9 APPRECIATING ASSETS That Are Making People RICH 💸💰🤑

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Appreciating Assets to Building Wealth

Appreciating assets are investments whose value can increase over time or can generate cash flows that can be reinvested progressively to take advantage of compounding. 

Here’s a list of the most appealing appreciating assets out there.

1. Stocks

A stock gives the holder ownership over a portion of the business and entitles them to receive any dividends paid by the company throughout its lifetime. Stockholders typically have voting rights on the company’s affairs and the value of their shares can increase over time if the underlying business is performing well.

Stocks of publicly-traded companies can be bought via a brokerage firm. Nowadays, this can be done electronically in a matter of seconds through apps like Robinhood and TradeStation. The capital needed to invest in stocks is not high. A portfolio can be built with as little as $100 by using fractional shares.

Stocks can make money for investors via price appreciation and dividends.

2. Real Estate

Real estate investments are one of the oldest and most popular appreciating assets in the world. Investors typically feel comfortable investing in this type of asset as they are a tangible item. 

The real estate market is quite ample, and money can be made in different ways. Properties can be classified as commercial, residential, and industrial. Land may also be considered real estate.

Nowadays, a person doesn’t have to necessarily buy an entire property to become a real estate investor. Instead, they can rely on vehicles such as real estate investment trusts (REITs), syndicates, and crowdfunded real estate projects to own a piece of the underlying property. This reduces the minimum investment required to get exposure to this appreciating asset.

Services such as Fundrise and EquityMultiple are a good alternative when it comes to real estate crowdfunding. Meanwhile, shares of hundreds of REITs are available and can be traded via a traditional brokerage firm such as Charles Schwab or Fidelity.

Money can be made with real estate as follows:

• The property can be leased in exchange for a periodical rent payment.
• The property can be remodeled and flipped. This transaction can generate a profit if the selling price exceeds the purchase price minus any money spent on renovations.
• REITs typically pay a dividend that comes out of the money made by the properties owned by the trust.
• A property or shares in a company holding one or more properties may see its value increase over time.

3. Bonds

Bonds are fixed-income instruments that entitle the holder to receive a periodical payment in exchange for loaning money to a company, government, or institution. These financial assets are traded in an exchange or over the counter, and their price varies depending on the solvency and overall financial health of the issuer and macroeconomic conditions.

Bonds can be classified in many ways depending on who issues them (e.g., corporate, municipal, sovereign, etc.), the creditworthiness of the issuer (e.g., investment-grade, junk), and how investors are compensated (e.g., zero-coupon, interest-bearing).

There are also vehicles such as mutual funds and exchange-traded funds (ETF) that hold a diversified basket of bonds. Investors can opt to buy shares of these funds instead of buying individual issues to mitigate the risk that a single issuer might become insolvent.

Money can be made with bonds via the coupon payments the issuer is obligated to pay periodically and/or if the value of the bond increases due to a change in macroeconomic conditions or an improvement in the perceived creditworthiness of the issuer.

4. Farmland

Farmland has become an increasingly appealing appreciating asset considering that the global population is on the rise, and the demand for food and crops seems to be growing unstoppably as a result.

In the United States alone, the value of farmland has increased by an average of 12.2% per year according to data compiled by AcreTrader. Those gains are similar to those produced by the stock market during similar periods, but, for some investors, the tangibility of this asset makes it a more attractive choice.

Farmland investments can generate money via periodical rent payments and capital gains if the price of the property increases over time.

Multiple companies have facilitated access to this appreciating asset by creating vehicles through which investors can buy a portion of the property. This reduces the minimum investment required to a few thousand dollars without affecting returns.

Some of the most popular services that offer access to farmland investing include FarmTogether and AcreTrader.

5. Rare Art

Investing in art involves buying masterworks in the expectation that their value will rise over time. This type of investment was reserved for the wealthiest cohorts of society in the past due to the complexity of assessing the intrinsic value of art for the untrained eye.

However, some companies have democratized access to this market and its appealing returns, as is the case of Masterworks, a firm that securitizes valuable works of art so investors can purchase a fraction of the artwork instead of the whole thing.

Money can be made by buying and holding the artwork directly to then sell it at a profit. The same goes for the fractional shares offered by Masterworks and other similar services. On the other hand, in some specific cases, museums, galleries, and certain institutions may offer some sort of compensation to investors for displaying the pieces they own.

6. Commodities

Commodities are tangible materials that are considered homogeneous by nature and that can be traded easily. Many products nowadays are considered a commodity going from crops to industrial-use materials and precious metals.

These commodities can be traded physically in a private transaction or they can be bought and sold via sophisticated financial instruments such as commodity futures.

Commodities can be considered appreciating assets if the demand for these products is expected to rise in the future or if supply is expected to be disrupted or diminished.

In most cases, investors buy commodities through financial vehicles such as ETFs and mutual funds or by using financial derivatives such as futures and options.

These instruments can be bought and sold via a traditional brokerage firm although the requirements to operate with commodity derivatives may be a bit strict.

Some of the most popular commodities are oil, natural gas, gold, silver, copper, livestock, corn, rice, wheat, coffee, cocoa, and soybeans.

Commodities only generate money for investors if their value appreciates over time.

7. Precious Metals

Precious metals have been considered appreciating assets for centuries. This is especially the case for those that are used for crafting fine pieces of jewelry such as gold, silver, and platinum.

Nowadays, precious metals are considered a commodity, as they are used by multiple industries for manufacturing different products. The price of precious metals is driven by supply and demand dynamics.

In the past, people had to buy these metals physically and find a way to store them safely. Nowadays, investing in these appreciating assets has been made easier through the introduction of financial vehicles such as exchange-traded funds (ETF) that track the price of each metal.

These funds take care of the process of buying and storing the metals on behalf of the investor, and they typically charge a low fee in exchange for doing so.

Meanwhile, for those who prefer to own the asset directly, other services such as BullionVault offer investors the chance to buy gold, silver, and other similar metals and take care of the storing and protecting the assets in exchange for a relatively modest fee. On the other hand, investors may also opt to buy shares of companies that mine precious metals.

Precious metals only generate money for investors if their value appreciates over time.

8. Rare Earth Metals

Rare earth elements, also known as REE, are not necessarily scarce, but they are considered hard to find and deposits tend to be rather small. The demand for these metals has been rising lately as their industrial uses have increased as well.

REEs include lanthanum, erbium, samarium, neodymium, and cerium. The consumer electronics industry is one of the biggest buyers of rare-earth metals, and they are typically employed to produce chemical reactions.

Cerium, for example, is used to refine oil. Lanthanum is used to create night vision goggles, and samarium is employed to build precision-guided weaponry.

Rare earth metals could be a great investment if corporations keep finding practical uses for them. Investors can get exposure to this fascinating market by buying futures contracts or via exchange-traded funds (ETFs) such as the VanEck Rare Earth/Strategic Metals ETF (NYSEARCA: REMX).

Money can be made if the price of these metals increases over time as the value of the futures contracts for these assets and the valuation of the companies that mine them will rise alongside.

9. Collectibles

Collectible items are not the go-to asset class for most people, but a lot of money can be made by those who know the potential that some items have to become rare and frantically sought pieces in the future.

This is the case with products like toys, cars, weapons, sports cards, comics, and historical items such as letters and pictures. 

Collectibles can either be bought at the time the item is released publicly or later on at trade fairs, garage sales, or online via e-commerce platforms like eBay.

In most cases, the risk of investing in these pieces is mitigated if the purchase price is quite low and investors just need to be patient and hold on to the item until it becomes rare. Money can be made with these assets if their price increases in value over time. Today, many platforms like Collectable, Otis, and Rally allow retail investors to invest in these assets.

10. Fine Wine

For some, wine is just a drink they like to enjoy with their preferred dish or while gathering with their friends. However, the best wine out there is considered quite valuable and, for those who have a trained eye in this particular field, it can also become an appreciating asset.

Fine wine is a niche alternative investment that consists of buying and holding top-quality bottles or cases with the expectation that their value will rise over time.

According to the Liv-ex Fine Wine 1000, an index that tracks the performance of this particular asset class, the value of a portfolio comprised of the best 1,000 wines in the world has produced compounded annual gains of 8.2% in the past five years.

In the past, investing in fine wine was quite risky as it required the appropriate storing of the cases, which increases the risk of damage and total loss if the bottles broke. Nowadays, some companies such as Vinovest and Vint offer the possibility of buying a fraction of a case of a valuable fine wine instead of the whole thing and take care of the burden of appraising, authenticating, storing, and selecting the best investable wine.

Money can be made with fine wine by holding on to the shares bought via these companies or by buying individual bottles or cases to sell them in the future at a higher price. 

11. Private Equity (PE)

Private equity firms are entities that identify potentially undervalued companies whose management is not doing its best effort to generate value for its shareholders. In most cases, the PE firm hires a new management team or optimizes the business’s performance, to sell the company at a higher price or take it public.

Private equity firms raise capital by selling common shares to investors. In most cases, only accredited investors qualify to buy shares in PE firms.

The performance of PE firms varies depending on how effective the fund is to increase the market value of the businesses it has bought. This goal can be achieved by improving the company’s business model, selling some underperforming segments of the company, reducing its leverage, or ramping up profit margins.

12. A Business

Starting a business or buying an existing one is also a way to invest money in an appreciating asset as long as the company eventually generates positive returns on the investment made.

A business can produce money via the profits it generates as a result of its regular operations or if it can be sold at a price that exceeds the amount invested by the shareholders at some point.

The odds of building a successful business increase if the founder has in-depth knowledge about how the industry works or has identified an unsolved problem or unmet need in the marketplace.

On the other hand, an existing business could be bought if the investor feels that the company is currently undervalued and could generate above-market investment returns for the risk assumed or if the business can be optimized to the point that it can generate more profits. Nowadays platforms like Mainvest can help retail investors get access to these investment opportunities.

13. Lending Products

Technology has revolutionized how multiple industries work, and that applies to finance too. In this regard, multiple platforms have introduced innovative business models that effectively remove the middle man (typically banks and other similar institutions) from the most common transaction in the financial world — making a loan.

Through these platforms, investors can opt to become lenders and build a diversified portfolio comprised of various loans to receive an interest payment in exchange for risking their money.

Some statistics claim that the annual returns produced by a well-diversified P2P loan portfolio can reach over 20%.

To get started, investors must sign up with a platform such as Prosper or MyConstant. After that, they must select a handful of loans to build their portfolio. After that step is completed, the investor can sit back and wait until interest payments start to come in and repeat the process whenever one of the loans is fully repaid.

14. High Yield Savings Accounts

Savings accounts are among the most well-known and used financial instruments in the world. Back when interest rates were meaningfully high in most developed economies, they were the safest place to park some money and watch it grow.

However, most savings accounts nowadays offer a very low-interest rate except for some exceptional cases.

In the United States, the highest-yielding savings accounts at the time this is written are offering annual percentage yields (APY) of 0.8%. Even though this sounds like nothing compared to the returns produced by other assets in this article, if interest rates in the country increase, these accounts could become more appealing.

Money is earned with a savings account via the payment of interest. In most cases, these payments are made every month. Moreover, the money in these accounts is protected by the Federal Deposit Insurance Corporation (FDIC) in the US.

So, even though high-yield savings accounts are not the most appealing in terms of returns — for now — they are among the safest choices among all appreciating assets.

15. Certificates of Deposit (CD)

A certificate of deposit (CD) is an instrument that entitles the holder to receive interest payments for locking up his/her money in an account with a financial institution during a certain period.

A CD is considered as safe as a savings account, and the most appealing certificates in the US currently yield around 1.25% per year if money is locked in for one year.

Interest payments are typically accrued and deposited into the CD, and interest is calculated on the daily balance of the instrument. This means that CDs are a good alternative to take advantage of compounded interest.

16. Currency 

Currencies might not be perceived as appreciating assets right away, but they do have the potential to generate gains for investors who understand the dynamics that dominate the global forex market.

If you live in the United States, it could make sense to diversify your cash reserves into various foreign currencies so you stay hedged against a deterioration in the purchasing power of the US dollar.

Currencies are listed in pairs. The value of these pairs expresses how much one unit of A currency could be obtained if exchanged for B currency.

The EUR/USD pair, for example, expresses how many US dollars would be obtained in exchange for one euro. If the value of the euro rises due to an improvement in the macroeconomic conditions of this particular region — along with other factors — an investor would obtain more dollars for the same amount of euros he holds.

If an investor believes that a certain economy will outperform that of the US in the future, it could make sense to buy and hold some of its currency for a certain period in the expectation that its value will rise against the US dollar.

Currencies can be bought directly in a physical exchange or bought electronically via the forex market.

17. Cryptocurrency

Cryptocurrencies emerged in 2009 back when an anonymous character, Satoshi Nakamoto, first presented Bitcoin (BTC) to the world as an innovative peer-to-peer payment system.

These digital assets have grown to become a standalone asset class valued at over $2 trillion, and they are now part of many portfolios due to the disruptive nature of the underlying technology that powers the entire ecosystem — the blockchain — and their potential practical uses.

Cryptocurrencies can be bought through exchanges such as Gemini, Coinbase, and Binance. They can be stored in a hot or cold wallet.

Money can be earned with cryptocurrencies by buying and holding these assets in the expectation that their price will increase in the future as they continue to be adopted as a payment method, store of value, and financial asset.

Moreover, it is also possible to earn interest by “staking” these digital assets or lending them to other people who can use them for trading and other similar purposes.

18. Jewelry

Investing in jewelry is similar to buying precious metal but with the added value of the artistic work that has been put into the piece to make it what it is.

Jewelry can be bought from high-end stores, designers, and even at auctions. Their value fluctuates depending on the price of the metals and gems that make the piece and its perceived “artistic” value.

Money can be earned with jewelry if the price of the piece or that of the materials that comprise it rises over time.

In some cases, rare jewelry could be leased to museums, galleries, and other similar organizations to be displayed to the public. This is typically the case when the piece has some sort of historical significance.

19. NFTs

Non-fungible tokens (NFTs) can be understood as digital property. These are goods that can be used in the digital realm, and their nature varies widely. They could be a picture, a letter, a tweet, or even a digital identity.

These digital assets can be minted on the blockchain — the technology that powers cryptocurrencies — and this gives the holder a certificate of ownership on the original piece, pretty much in the same way that a certificate of authenticity would work for a painting or a sculpture.

NFTs are considered appreciating assets if their perceived value increases over time. This has been the case for some NFT projects like the Bored Ape Yacht Club avatars and the so-called Crypto Punks.

An investor who has an eye for spotting the most promising projects in this up-and-coming space could make bank once the digital asset gains more popularity. In this regard, some NFTs have been sold for millions of dollars.

20. Digital Assets

The pandemic undoubtedly accelerated the adoption of digital solutions at many scales, and this has made the digital world an increasingly important space for businesses and individuals alike.

As a result, digital properties have been increasing in value lately, and they come in many shapes and forms. One easy example of digital property is a domain name. For example, owning the domain “Tesla.com” may have been a good investment before the popular electric vehicle manufacturer came out, as the owner could have sold the domain to the company at an interesting price.

That said, there are other more sophisticated digital properties such as a piece of land in a so-called “metaverse” — a virtual realm created by a company/organization to provide a space in which users can interact with each other and enjoy some interesting experiences.

Money can be made with these assets by buying them at a relatively low price in the expectation that they will eventually become a highly demanded asset. Other examples include social media accounts, fully-functioning websites, and images.

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Best Financial Products to Invest in Appreciating Assets

Now that we have touched ground on the most appealing appreciating assets, we will dive into the vehicles that can be used to invest in them.

Mutual Funds

Mutual funds are vehicles through which investors can get exposure to different corners of the financial market. These funds issue shares that give investors ownership over a fraction of their assets under management and entitle them to receive periodical dividends (if any).

These funds are managed by financial services firms, and their portfolio is comprised of a basket of financial assets whose nature and individual weight vary depending on the methodology and objective of each fund.

Mutual funds can be used to invest in stocks, bonds, real estate (REITs), commodities, precious metals, and a few other of the appreciating assets named in this list. These funds charge an annual management fee and typically require a minimum investment of a few thousand dollars.

Exchange-Traded Funds (ETFs)

Exchange-traded funds (ETFs) are similar to mutual funds, but their shares trade in a public exchange in a similar way as a regular stock. Their portfolio is comprised of assets that match their nature, scope, and reach, and they can be used to build diversified investment portfolios for both small and large investment accounts.

ETFs track the performance of a wide variety of appreciating asset classes including stocks, bonds, commodities, real estate, precious metals, and even cryptocurrencies. The minimum investment required is the price of the ETF at any given point or even less, as some brokers now offer fractional shares for most of these instruments.

Options 

Options give the holder the right, not the obligation, to buy or sell a certain asset in the future at a pre-determined price once the contract reaches its expiration date or, in some cases, even before that.

Options can be used to get exposure to some of the appreciating assets named in this article such as stocks, commodities, cryptocurrencies, or to the exchange-traded funds (ETF) that track the performance of these assets.

Money can be made with options if the price of the underlying asset rises above the strike price for a call option or if it declines below it for a put option. The cost of an option is called the “premium,” and these instruments can expire worthless in some scenarios. Options can be bought with a traditional brokerage firm.

Futures

A futures contract is a financial derivative that obligates the buyer to take delivery of a certain asset on the expiration date or, in some cases, the transaction can be settled in case. 

The price at which the asset is bought is defined by market dynamics as futures contracts trade in an exchange such as the Chicago Mercantile Exchange (CME). For those who sell these contracts, the purpose is to lock in the price at which they will sell their assets (commodities, currencies, etc.) in the future. 

Meanwhile, for those who buy them, they could either be aiming to lock in the price at which they will buy the asset in the future or they could be speculating in the markets to make a profit as they expect that the value of the underlying asset will rise in the future.

Futures contracts can be used to trade or invest in commodities, fiat currencies, cryptocurrencies, and precious metals primarily.

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FAQs on Appreciating Assets

The following is a list of answers to the most frequently asked questions we get on the topic of appreciating assets.

What Is an Asset?

An asset is a tangible or intangible item that can produce some sort of economic benefit to the holder, whether that comes in the form of steady streams of cash flow or via an increase in its market value over time.

What Are Appreciating Assets?

Appreciating assets are those whose value is expected to rise over time. They are typically considered either a good store of value or a tool to build wealth.

Do Appreciating Assets Come with Risks?

Every investment carries some sort of risk. The less risky appreciating asset in this list is savings accounts followed by certificates of deposit as they are fully backed by the Federal Deposits Insurance Corporation (FDIC) in the United States. 

Most other appreciating assets named here expose investors to different kinds of risks, and choosing which one is more suitable for an individual when building an investment portfolio largely depends on the person’s financial goals and risk tolerance.

What Is Something That Always Appreciates in Value?

In the investment world, there are no guarantees. None of the assets listed in this article is a sure thing as market conditions can change at any given point and the value of these assets could diminish as a result. 

That said, investment-grade bonds and most other interest-bearing assets including savings accounts and CDs will always appreciate in nominal terms (not including the impact of inflation) as the investor will earn a fixed amount paid periodically while the principal involved in the transaction will be returned at some point.

Is My House an Appreciating Asset?

Yes. However, it may not be considered an investment by some as it is also the place where you live. This means that, even if its market value rises, you may not fully enjoy that increase unless you sell it and buy a cheaper property to realize the gain.

Are Cars Appreciating Assets?

No. Cars are an asset, but their value diminishes right after they are taken out of the dealership. The reason for this is that cars suffer wear and tear. In normal circumstances, the selling price of a car after one or two years have passed will always be lower than the purchasing price.

Are Bank Loans an Asset or a Liability?

Bank loans are a liability as they have to be repaid at some point.

What Assets Do Rich People Buy?

Wealthy individuals typically earn money by building a business or inherit funds from their parents. They use these funds to invest in some of the appreciating assets named in this list and usually follow the advice of a professional to build diversified portfolios comprised of stocks, fixed-income instruments, real estate, and alternative investments.

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Final Thoughts

Investing in appreciating assets is the way to go for people who want to turn their savings into wealth. There are so many different asset classes nowadays that most investors will find it easy to pick a handful of alternatives that match their goals and risk tolerance.

We hope that this list gives you ideas on how to grow your current holdings by building a diversified portfolio of appreciating assets. Best of luck!