There's something about "found money" that feels especially good. Perhaps because it isn't burdened with the memory of hard work or responsibility, it feels a little special. Then again, maybe it feels special because it is special; it's a little extra money that didn't require any particular extra work but it spends just as well as hard-earned cash. With that in mind, let's consider some of the personal financial windfalls that can put a few extra dollars in your pocket.
A Well in Your Backyard?
The discovery of oil or gas underneath your property may not transform your family into the Beverly Hillbillies, but it can definitely put some extra cash in your pocket. Farmers, ranchers, and other landowners in many parts of the country are finding energy company representatives knocking on their doors, ready to write checks worth thousands of dollars per acre as signing bonuses for leases that give the companies the right to look (and lift) oil, gas and other resources. (Calculate how much your property will need to appreciate to cover the costs of owning it. Check out Will You Break Even On Your Home?)
Not all of these deals offer the same risk/benefit reward to the property owner. There is no such thing as an "average" royalty or signing bonus because so much depends on the prospects of the area in question and the bargaining power (or desperation) of the energy company. Still, a lease in a hot area can offer thousands of dollars per acre in bonuses and royalties in excess of 10%; leases in less productive regions may only offer a few hundred bucks in bonuses for the right to trial exploratory wells.
To read the full column, please click below:
http://financialedge.investopedia.com/financial-edge/0411/Financial-Easter-Eggs.aspx
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