Every one of us dreams of enjoying only the best things in life and many thinks that investing money in a Minnesota real estate is the perfect solution. Yet, it is also true that with the negative things perpetrated by the media - it seems a bit scary!

Never believe anyone that tells you an investment is 100% safe and smart. EVERYTHING that you do with your money has a certain amount of risk involved with it, even if it's just putting bills under your mattress; speaking of which, let's talk about what happens if you do NOTHING with the money you save (e.g., putting it under your mattress). That wouldn't be very smart--fire, flood, theft, etc. could make your money disappear very quickly with no hope for return.

But, you say, what if I put my money in a bank safety-deposit box, won't THAT keep my money safe? Yes, it will keep the physical paper currency safe, but remember that the bills are only worth what the current value of the currency is. Over time the buying power of currency goes down (inflation!).

In the US, the annual rate of inflation is about 3 percent that translates to commodities increasing by almost 3 percent every year. In other words, your money is worth 3 percent less if it is being kept inside a safety box. Would you still perceive of it as "saving" when obviously your money's purchasing power is gradually vanishing?

What about a savings account? These accounts are almost always protected by the FDIC (Federal Deposit Insurance Corporation) so there's not much risk of your bank going under and you losing your money, but again you're swimming upstream against the current of inflation. Even the best savings accounts out there barely give you enough interest to counteract inflation and often times inflation is outpacing your savings account interest earnings; but at least you're not losing AS much!

How about stocks? I like to think of investing in stocks as investing in an "idea". You don't hold claim to any tangible item. You only "own" the fact that you have contributed funds to the "idea" that the entity you contributed your money to will somehow add value to itself and subsequently add a gain to the money you started out with.

How much control do you have over this "idea"? ALMOST NONE! The only thing you can do is research the track record of the entity and the people close to it (e.g., the CEO, CFO, etc.) to guess whether or not the "idea" will work out in the way you hope it will, but it's very difficult to know ALL the factors that will come into play. My opinion is that unless you invest in the stock market as a profession or spend a great deal of your time researching companies, investing in stocks is very distant from your personal interests and can be of great risk. That is why I, and many others, have chosen the last option we'll talk about: real estate.

What primarily distinguishes real estate from the ones mentioned above is its being "tangible" (this presupposes that you can experience it with all your senses: you can see it, touch it, and even improve it.) Likewise, the risk involved as far as losing the physical asset is concerned seemed distant. If it does, there's a wonderful thing called insurance! Can you apply the same in the case of stocks? Your property's value also grows with inflation unlike paper currency so you do not have to worry about your investment losing its purchasing power every year.

Another great thing about real estate is that money is made in multiple ways (these are too numerous to detail for the purpose of this article, but the benefits include huge tax breaks, gained equity through renter-paid debt reduction, equity gained through improvements, and appreciation). As stated in the beginning of the article, no investment is 100% safe, but it is my strong opinion that if done with some foresight, real estate is where you'll find the most bang for your buck as well as the most security for your money.