Looking to Invest but Don’t Know Where to Begin
As we all know investing is important for our futures. There is no guarantee that social security benefits will be sufficient to carry us through our retirement years or how long social security benefits will be available.
Individuals are looking to ensure their futures as they are aware that depending on benefits such as social security that they may get a rude awakening. Investing has become their answer for their future.
You may have money in a savings account right now. And unfortunately it is accruing little to no interest for you. But now you are looking at other avenues to have your money produce higher gains. Again, investing just may be the answer you are looking for.
Investing is also a way of being able to attain the things that you want or need, such as purchasing a new home, funding a college education for your children, or purchasing some type of luxury item. Of course, whatever your financial goal may be will be the determining factor in the type of investing you do.
For example, if you are looking to make quite a bit of money fast, then you would be better suited in investing in the high risk arena. This type of investing gives a higher return in a shorter amount of time. If you are looking at a return on investment to make a purchase down the road, then you would be able to invest in lower risk investments which in time will increase in value.
As we all know, the purpose of investing is to create wealth and security for our future. Retirement is inevitable. Most of us will not, nor do we want to, work for the rest of our lives.
What we do want though is to create a wealth stream for us to live comfortably and be able to afford those luxuries in life we want.
Depending on social security is risky anymore. And in addition, depending on a company’s retirement plan is also risky. We have all seen companies go bankrupt and with that they have taken retirement plans or have taken away from those plans. So, making smart investments can make for a comfortable financial future.
Investing for the Long Term
Now that you are ready to invest just know that you have several option when it comes to investing. There is really no need to go all in and invest in the riskiest stocks or ventures that are around. You can easily invest your monies in safe ways that will give you a decent return on your investment over a long period of time.
One safe investment to consider is bonds. There are a number of different types of bonds that you can purchase. Bonds are just like a Certificate of Deposit. The difference between a bond and a Certificate of Deposit is that a bond is issued by the government instead of being issued by a bank like a certificate of deposit. Based on their relatively low risk, your initial investment can increase over time.
Another relatively safe avenue for investing your monies is mutual funds. A mutual fund is when a group of investors pool their money together to purchase stocks, bonds and other various investments. Mutual fund accounts are managed by a fund manager who typically determines where to invest the funds monies. The key to a mutual fund is to find a reputable and qualified fund broker who is experienced in dealing with mutual funds, and they will invest the fund’s monies. Mutual funds are more risky than bonds but still a relatively safe investment under the right fund manager.
Another long term investment vehicle is stocks. Shares of stocks are realistically shares of a company. Stocks can do well when the company is doing well financially as this is when the value of your investment rises. But, if the company is performing poorly financially, the value of your stock purchase will drop. Obviously, stocks are riskier than mutual funds and bonds. Although there is a higher amount of risk involved in the purchase of stocks, purchasing stock in companies like Apple or Microsoft can pay off well and be relatively safe.
Right now while we are experiencing some volatility in the stock market as well as world-wide turmoil, some investors have been in favor of investing in precious metals for the long term. A gold backed IRA has proven to be successful over the long run. There are also investors who may favor silver as an investment. Most financial experts believe that diversifying and holding 5 – 15 percent of your investment will provide an “insurance” for your monies should something devastating occur such as the 2008 crisis. It is important to find a reputable Gold IRA firm to assist you in this venture.
The most important thing you can do before investing money is research. I can’t say that enough. When you choose to buy stock in a company, try to buy stock in a company that is well established. When you choose to invest in a mutual fund, choose a broker who is well established with a proven track record. If you don’t feel that you are ready to risk your monies on stocks or mutual funds just yet, then invest in bonds as they are guaranteed by the Government.