Investment Tips

Sound investment strategies can help you build a  very prosperous future. You must try and develop a new investment strategy  for each stage of your life. You must be aware of all the investment opportunities available in the market and use them to your best advantage depending upon your stage in life.

If you start saving $200 per month regularly for 20 years, you will have saved $48,000. But if you invest the same amount regularly and wisely for the same period it can be easily turned into $5,00,000. People save money in piggy banks and also in normal banks. Have you recently checked how much interest are you getting on your savings in your bank account, I am sure you would have realized that the banks do not give interest on savings accounts worth getting excited about . If you think about term deposits and some smart saver accounts they do give you some better interest like maybe 4%-6% but remember the catch you have to pay tax on all these earnings at your highest tax bracket. So if you are in the 50% tax bracket you will straight away loose 50% of your interest every year to the tax man. And if you hold your investments for more then a year the taxman gives you 50% discount on your capital gains tax (egs. Australia).

The investment strategies of an 18 year old would and should  be quite different to that of a 30 year old and the needs of investing of a 60 year old would also be very different from both of them. Remember the earlier you start investing the better your chances will be of retiring rich. First of all we must clearly know the difference between saving and investing. If you think you would earn enough throughout your life and by saving regularly you can become rich, then you will be among a very few who would have done that. But if you can invest regularly there is a very good chance that you will become rich. So remember it makes much more sense to invest wisely and regularly then it makes sense just to save regularly, of course you have to be able to save to invest. So what are the investment options available to us in this day and age.

1. Shares, Options, CFDs, Property residential and commercial, Bonds,
2. Mutual Funds
3. Gold, Diamonds
4. Art

Some good investment tips:

1. Make your money work for you. Learn how to invest money and make it earn for you. Read books, scan the internet, gain knowledge and become a learned investor.
2. Never put all your money in just one investment. Remember the old saying “Never keep all your eggs in the same basket”. Diversification is very important to keep your money safe and growing.
3. It is inevitable that your investments will not keep growing all the time, there will be periods when they start to decrease in value. The Share Market, the Property market all have there periods of gloom, but if you invest in quality then you can be sure that your investments will grow over time. On an average both the share market and the property market have always outdone a simple saving  strategy.
4. Borrowing to invest can be a very good strategy for the young and who can invest wisely with some good advice. This strategy is known as leveraging and can become a very good tool to become rich fast, but if done badly it can also make you loose your capital at a much faster rate. Remember there good debt and there is bad debt. Good debt is taken to make investments and which returns more then the interest that you are charged for it. Bad debt is taken for your needs and luxury.  Loan for buying property and shares can be classified as good debt. Credit card loans for shopping, car loans can be classified as bad debt. Eliminate your bad debt as soon as possible and try to have as much good debt as you can afford to have. Good debt makes you richer by the day and bad debt makes your poorer by the day. 
5. Your investment should contain components of both risky and safe investments. Remember your risk component should be larger when you are young and should decrease with age. It is easier to recover your losses later on if time is on your side and the gains are also always proportional to the amount of the risk in the investment. But the risk should always be a calculated risk. You should never invest in schemes which sounds too good to be true.
6. Never sell when you feel the stock or any other investment has reached its bottom. This way you will loose money and also loose a chance of any recovery. Remember that history tells us that both the stock market and the property market have always bounced back.
7. Be patient and always invest with a long term view of the market. The market is known to transfer the money from the impatient to the patient.
8. You will make mistakes. Learn from your mistakes. Remember everyone makes mistakes.

Learn to make a Niche profitable business

3 Comments

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  By Kelis, May 22, 2011 @ 5:48 am

  Sueprior thinking demonstrated above. Thanks!

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  By admin, May 22, 2011 @ 8:32 am

  Glad to know you liked it

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  By Candra Guitreau, May 30, 2011 @ 10:18 pm

  Some really nice stuff on this website , I enjoy it.

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