How to Get into Alternative Investing
Alternative investing can help boost returns and add diversification, but it’s not for everyone. Here’s what you need to know before you begin your journey.


With recent headlines warning of a potential surge in market volatility, more and more investors are looking beyond traditional asset classes and exploring alternative investing paths. Alternative investing, which includes hedge funds as well as private assets like real estate and side businesses, can provide diversification, reduce risk and generate additional income.
Alternative investing has long been considered the domain of the wealthiest and most sophisticated investors, but don’t let that intimidate you. Like many areas of finance, a new generation of technologies and investment classes are making alternative investing more approachable and transparent.
That said, alternative investing still requires checking a few financial boxes before getting started to ensure you’re building from a solid foundation. For example, before diving into alternative assets, investors should consider eliminating any high-interest debt, creating an emergency fund of three to six months of expenses and having at least $100,000 in savings set aside for long-term investments.

Sign up for Kiplinger’s Free E-Newsletters
Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.
Profit and prosper with the best of expert advice - straight to your e-mail.
Once you’ve established a solid financial foundation, it’s time to start exploring alternative investing options. Here are the three main paths to consider when beginning your alternative investing journey.
The DIY approach.
Many people get their start in alternative investing by buying a fixer-upper investment property or starting a side business, as these are some of the most common alternative investments.
This option requires a significant amount of time and effort, but it can also be one of the most lucrative since you don’t have to pay anyone to produce the returns. You’ll want to make sure you’re equipped with the right resources to help guide you along the way. Some I’ve found to be useful include:
- Blogs (for example, BiggerPockets, Financial Samurai).
- Books (The 4-Hour Workweek, Pioneering Portfolio Management).
- Local meetups (for example, EO, YPO).
Self-directed investing.
This path involves relying on your network to source deals or exploring the many alternative investment marketplaces that have cropped up over the past decade, like EquityMultiple for real estate or AngelList for venture deals, for example.
Self-directed investing requires a lot of research and due diligence, but it can be rewarding if done correctly.
This option is best for someone who is well-networked or has the time and knowledge to perform proper due diligence.
If pursuing this path, it’s critically important you choose deals you believe to be in the top 10% of their category, ideally.
MFOs or tech-asset management hybrids.
If you’re passionate about pursuing alternative investments, but don’t have the time or expertise required with options one and two, outsourcing to trusted experts might be an ideal path for you.
There are two primary options, multifamily offices, like IWP, that offer a range of planning and investment diligence services for a flat fee, or tech-enabled asset management firms like Equi (our platform) that rely on sophisticated data and a specialized diligence team to offer portfolios of what we believe to be the top alternative investment products. This is the most “hands-off” and streamlined approach.
Remember, alternative investing can be a rewarding experience, but it's important to do your research and understand the risks before diving in. It's also important to have a solid financial foundation before investing in alternatives. By following these principles, you'll be well on your way to a successful alternative investing journey.
Profit and prosper with the best of Kiplinger's advice on investing, taxes, retirement, personal finance and much more. Delivered daily. Enter your email in the box and click Sign Me Up.

Tory Reiss is a three-time founder of venture capital-backed financial technology startups. He’s currently the CEO of Equi, the elite destination for alternative investments. It is equal parts hedge fund and technology platform, with exclusive access to a variety of uncorrelated alternative investments.
-
Don’t Miss Apple and Walmart Back-to-School Tax-Free Holiday Savings this Summer
Sales Tax Select states host sales tax holidays during the summer. Here’s what you can purchase.
-
The Rule of Retirement Inversion
The rule of retirement inversion says that to have a great retirement, you must ask yourself what would ruin a great retirement — and then plan to avoid it.
-
How Divorced Retirees Can Maximize Their Social Security Benefits: A Case Study
Susan discovered several years after she filed for Social Security that she is eligible to receive benefits based on her ex-spouse's earnings record. This case study explains how her new benefits are calculated and what her steps are to claim some of the money she missed.
-
From Piggy Banks to Portfolios: A Financial Planner's Guide to Talking to Your Kids About Money at Every Age
From toddlers to young adults, all kids can benefit from open conversations with their parents about spending and saving. Here's what to talk about — and when.
-
I'm an Investment Pro: Here's How Alternatives Could Inject Stability and Growth Into Your Portfolio
Alternative investments can often avoid the impact of volatility, counterbalancing the ups and downs of stocks and bonds during times of market stress.
-
A Financial Planner's Guide to Unlocking the Power of a 529 Plan
529 plans are still the gold standard for saving for college, especially for affluent families, though they are most effective when combined with other financial tools for a comprehensive strategy.
-
An Investment Strategist Takes a Practical Look at Alternative Investments
Alternatives can play an important role in a portfolio by offering different exposures and goals, but investors should carefully consider their complexity, costs, taxes and liquidity. Here's an alts primer.
-
Ready to Retire? Your Five-Year Business Exit Strategy
If you're a business owner looking to sell and retire, it can take years to complete the process. Use this five-year timeline to prepare and stay on track.
-
A Financial Planner's Prescription for the Headache of Multiple Retirement Accounts
Having a bunch of retirement accounts can cause unnecessary complications. Consolidation can make it easier to manage your savings and potentially improve investment outcomes.
-
Overpaying for Financial Advice? A Financial Planner's Guide to Fees
Take five minutes to review how much you're paying for financial advice. If you're overpaying, you could be better off with an adviser who charges a flat fee.