Best ways to invest your money

There is nearly always risk associated with any type of investment.

What you need to do is weigh out the risk versus the potential return. There is a general believe that a safe strategy is to use 1/3, save 1/3 and invest 1/3 of whatever you earned. Obviously this depends very much on how much you earn, but if you can afford to save and invest at the same time this is good advice. The difference between saving and investing is that investing has a much higher potential return but also higher risk.

Let us now consider some of the ways to invest money. It depends on your individual circumstances, how much disposable income you have and how much risk you are prepared to take.

1. Property – Most people aspire to own their own home so they have somewhere to live when they retire without having to pay a large monthly rental or mortgage. In my opinion this is a good investment because you always need somewhere to live. And if you can earn enough to buy a second house outright then you will be able to live in one and live off the rental from the other.

2. Pension funds – Most people will invest a certain proportion of their income in a pension fund for retirement. This used to be seen as a safe way of investing although in recent years with the collapse of some private pension funds you need to consider your options very carefully.

3. Health insurance – Although this does not need a big investment, remember that if you are unfortunate enough to face a large medical bill you may have to sell your house or your savings to cover it. Good health insurance is a very good investment. The above types of investment are probably the safest ways to invest your money but if you have done well and can afford a bit more risk on speculative investments, you can consider some of the following.

Other options in clued, Stock Purchase Plans, Index Funds, Forex trading etc.

Read more…

Advertisements

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

%d bloggers like this: