[jokerthief]

I'm not going to read any of the other posts so if this is redundant, move on. That said, you could buy discounted promissary notes. They are usually 10K or more but it's possible to find smaller ones. The way they work is, basically, you find someone who has a promissary note for a future value of X and they need to liquidate for some reason so you come along and offer them it's present value Y minus a discount. For example, someone has a settlement from a lawsuit and has $10,000 coming to them over the next 5 years. They need money now so you offer to give them $6,500 for the note giving you a $3,500 return over five years or 10.77% per year. That is simple interest return not compound however.

I've never done this sort of investing because it's tough to find someone who is willing to sell their promissary note for a discount that's high enough to be worth your while (remember, simple interest < compound interest). It is possible however. I have a cousin who sued Target and the Gap (long story) and got a $500,000 dollar settlement that was annuitized over 10 years. A few weeks after the settlement, she got a call from some guy who offered to give her $170,000 up front for the note. She took the offer and gave the guy a note that gave him a 19.4% simple return. It's a bad deal for her but in her mind it was a lot of money because she was getting around $4200 paid to her monthly and $170,000 up front seemed huge in comparison. If you work the right deal, it's a perfect investment...large return, no risk.