Everyone wants their money to work harder for them. Which is why investments are so popular. The earlier you invest your time into research, and money in the right places, the more you can reap the rewards.
On face value talking about investments might sound a bit complicated, but really it is the act of putting your money into something, where you will get (in most cases) a return on that investment. There are short term and long term investments, most people prefer to have a mix of both.
Is It Risky?
There are some risks when it comes to investing. There are more than a few riches to rags stories that circulate about people who plunged a lot of money into stocks, only for them to crash. Or there are the investors who scammed people in order to make big bucks.
You won’t be able to remove all risks, but you can minimize the risk when you put your money in the right places.
What Should You Invest In?
Ideally, you want to keep your investing as simple as possible. This means investing in a range of things, stocks, shares, and more tangible items like property and gold.
One of the critical things for success in investing is making a plan and sticking to it. This will stop you from making investments that are off-plan or don’t fit with your long term financial goals.
Real estate is a popular choice when it comes to investing cash and making money while you’re asleep. The great thing is that you don’t need to have millions in order to make the right investments. Real estate investments are long term, and more people are now taking advantage of buying properties in multiple countries.
There are a number of popular options in the real estate market, buy a condo, or buy a beachside property? Buy an office space, or purchase a commercial property?
Your decision should be based on your long term goals.
The great thing about real estate is the cash flow tends to increase year on year. Thanks to inflation, the rental prices on properties go up, and the investor will see a good return.
Mutual funds can be a great option if you like the idea of someone else managing your funds. A mutual fund is a professionally managed investment option that pools your money together with other investors.
The manager of the fun will use the money to buy securities for the whole group.
These types of investments are more diversified, so they are often safer. And, it can be a much less expensive way of investing. However, you will need to be aware that you will likely see some fees and commission – but that is still less expensive than investing across multiple platforms.
Many people have found the joy in investing in crowdfunding platforms. There are a number of platforms that you could consider. It is important to note that for many, you will be in charge of your own account and will need to work out your own risk.
- CircleUp – Most of the investment opportunities here are customer-facing businesses with at least 1 million in revenue. You have access to company profiles, as well as revenue, partners, and you even have access to samples too (where they are offered).
- Seedrs – A range of companies from fintech to food. Many are UK and EU based. There is a secondary market where you can buy shares in a range of companies, and sell your own shares via the platform. You can invest small amounts on Seedrs too.
- EarlyShares – this platform is dedicated to commercial real estate crowdfunding opportunities. Due to the high value of the assets, most investments are in the thousands, so this is great if you have a lump sum to play with.
If you want to make sure you have a nest egg for later in life, then retirement plans are the way to go. Here are a couple of options to consider.
When it comes to your Roth IRA, your contributions will be after-tax. This means that there is a potential that your money can grow tax-free while you save. The most significant benefit here is that you can make a tax-free withdrawal when retirement time comes. If you meet the conditions, that is. This is the most recommended investment and retirement account for most people.
If you have the opportunity to have a 401(k) with an employer match, then this is one of the best investments possible. This is only the best if you have the ‘match,’ meaning that your employer will match every dollar you put in. There are a number of Robo-investors that are ideal for managing 401(k) accounts if you have some money spare to invest.
With a traditional IRA, the contributions that you make may qualify for a deduction on your tax returns. There is also the potential that your earnings can grow tax-deferred up until the time you withdraw them come retirement time.
Manual or Auto
In recent years more people are turning to Robo-investors to help them make quick and smart decisions. Typically it is best to have a financial advisor, but if that isn’t an option for you, you have a lot of learning to do. Robo-advisors are one of the best ways for first-time investors to get started and show you the ropes. They are very accessible for most people and usually more affordable for those looking to test the investment waters.
When it comes to investments, it is essential that you first set a goal for your money. Consider what your long term financial goals are, and build an investment plan around that – and diversify. When it comes to investments, you should only ever invest what you can afford to lose and make sure you understand all of the terms and conditions of any purchases or investments that you make.
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