Life’s full of surprises. That’s why it’s good to set aside some money so that if you ever find yourself in need of a quick cash injection, you’ve got it there ready. Investment is a great way of setting aside money without leaving it in a regular day-to-day bank account. Of course, all investments carry risk – but not all risk is equal. If you’re looking to invest your hard-earned cash in an eventual and lucrative return, you may be wondering where to start. The first challenge is to know what sources to trust with your money, and whether your return will actually be as spectacular as you’ve always hoped for. There are, though, many different ways that you can ensure your investment is a wise one. Check out these amazing ways and places where you can invest your money for the greatest and highest return.
One of the first ideas that comes to mind when considering investing capital is the stock market. Investing into the stock market is a pretty simple premise: you are buying shares in one or more companies with the intention of making a tidy profit. But how do stock markets work?
The stock market is simply a place where buyers and sellers meet to sell shares – each a small (or sometimes large, depending on how much you’ve got to invest) part of the business. If a business increases its growth in a year and the future is looking promising, the price is likely to increase, and vice versa if the company doesn’t perform well that particular financial year.
Firstly, what are shares? The aim is to grow and ultimately boost profits to turn a business into a financial success, and businesses offer investors the chance to back it up with their own cash. So, you’re essentially buying a small portion of the company and being a ‘shareholder.’ If you like, you can exchange or sell the portion of the business you own with someone who wants to buy it.
If the business that you want to invest in increases its growth, you might sell your shares back to them (or anybody else) for a very big profit. Or instead, you may maintain your stocks. Remember if you’ve invested in a company that suddenly plummets, you might lose money too. The trick to good stock trading is keeping an eye on the market so you get the most from your investment.
Cryptocurrency is a fairly new, yet very successful way of investing your money – if it’s done correctly. It’s important to do your research before heading down the route of cryptocurrency investment, so what exactly is cryptocurrency?
Cryptocurrency is a form of payment, which can be traded for goods and services online. Some businesses have provided their own currencies, also referred to as tokens, and these can be exchanged directly for the good or service the business offers. Think of them like you would play casino chips or tokens. To access the product or service, you will need to exchange real currency for the crypto-currency.
Cryptocurrencies function using a blockchain-based technology. Blockchain is a decentralised technology that manages and records transactions spread across many computers. Part of the technology’s appeal is its protection.
Why is it so popular?
Cryptocurrencies cater for a number of reasons to its backers. Here are a few of the most common ones:
- Investors view cryptocurrencies like bitcoin as the currency of the future and are rushing to buy them now, presumably before they become more expensive
- Many supporters like the fact that cryptocurrency prevents central banks from controlling the money supply, as these banks continue to lower the value of money through inflation over time
- Some supporters like the cryptocurrency technology, the blockchain because it’s a decentralised database and recording mechanism which can be safer than conventional payment systems
- Some investors like cryptocurrencies as they are growing in value and have little interest in the long-term adoption of currencies as a means to transfer money
Cryptocurrency can be used as a long-term or short-term investment, so if you’re looking for something with a quick turnaround you’re in luck. If you’re not keen on the idea of jumping straight into cryptocurrency investment, then you can find a penny stock simulator which will help give you a feel of what to expect.
A common misunderstanding is that cryptocurrency is very much like stocks. While there are similarities such as the ability to pull a large profit from your investment, it’s important to know that there are many differences between the two. Always remember to do your research before investing your hard-earned money into something such as stock and/or cryptocurrency.
Investing in property has always been a good investment. Why? Because people will always need somewhere to live! If you’re looking to make an investment that you can cash out for yourself or even your children say, 20 years down the road, then investing in real estate is something you should seriously consider. Not only is real estate one of the more stable markets to invest into, but there are many other benefits that come along with it:
- You can rent out your property/properties and make a regular income on the side.
- You won’t have to worry about a landlord asking you to leave your home – you own it!
- You’ve got the chance to make more money than you paid for it, by simply making improvements over the years and relying on the property market to no doubt, increase.
Remember that if the money you do have available to invest isn’t enough to buy/put a deposit down on a property, then you can enlist help from help to buy schemes. These schemes are designed to help first time buyers obtain a mortgage and get themselves onto the property ladder. They work by selling the property to you in small chunks. For example, you could buy 40% of a property and then choose to either sell your share back, or continue buying more of the property. An incredible way of getting onto the property ladder when you’ve not got a huge sum of money. You can often get started with as little as a few thousand pounds as deposit!
One of the downsides of real estate investment is that like anything in life, you have to look after it to regain the full value when you decide to sell. However, property maintenance can be extremely expensive. Many landlords overcome this problem by keeping aside money from the rent they’ve made to put towards repairs and maintenance when it crops up. Obtaining home insurance and also renting out your properties through a realtor can also really help protect your assets.
High Interest Savings Account
You may not have much interest in investing your money in a specific spot, necessarily. Most people would like to just know exactly where their money is – which is a clever decision! Choosing to put your money into a high-interest savings account lets you know where your money is and how much money you have, all while earning a good amount of interest. High-interest accounts will earn you hundreds more per year compared to standard savings accounts that will give you very little interest, maybe a pound or two here and there! A good return for just having money in an account, right?!
You will benefit even more if you use a Certificate of Deposit (CD), a savings account that offers a higher interest rate and a set date of withdrawal. But remember, you ‘re exchanging comfort for the amount of money you’ll get in return. You may plan to let your money sit tight for a certain amount of months or years with a CD, and if you remove your money early, you will receive a fine. But, you’ll be rewarded with a return of about 2 percent or more if you can be patient.
One thing to be careful of with these kinds of savings accounts is that because of the volatility of the economy, the amount of interest you receive will very much fluctuate. However, you have full control over your capital, it’s safe and whenever you want it, you have full access to it.
As you can see, there are many ways to invest your money for a nice return, whether that be 20 years down the line or the very next day. Remember these key factors to avoid loss of money and your disappointment:
- Always do your research before investing money
- Keep an eye on the economy before, during and after investment – it can help you with future decisions!
- Look after your assets! Regular but small amounts of maintenance can help avoid large bills on your assets.
- Speak to a specialist. If you’re looking to invest in stocks or cryptocurrency, get an opinion from someone who’s been in the sector a while.
Following these guidelines will help make you some extra money through wise investment!