Why Invest and Why Do It Early?
It is often said that what one does at the start of the year determines how the rest of it would follow. This is why most people choose to invest in the first quarter of the year. But more than building a habit, investing early means you do not miss out on opportunities. The tendency of people is to prioritize and pay huge expenses first and invest what remains. Investing, therefore, comes like an afterthought.
The alternative viewpoint to investments is treating it as a discipline. If you break down investment, it is an input using the principles of managing funds, risk-taking, and planning with financial returns as an output. Nothing big comes easy, so it follows that if you want great returns, you should also put a more active approach to investing. Investing ahead of time means the rest of your year is planned out and that includes all your future expenses, so you are more aware of your financial outflows, and managing your spending becomes an imperative.
Kinds of Investments to Look Into
In every investment, there must always be the willingness of the investor to shell out money and have it untouchable for a certain amount of time. The other source of hesitation of some springs from the investment’s associated risk, the Siamese twin of returns. The direct proportion of inputs to outputs is logical and in most cases, it also serves as the venture’s test of legitimacy. Below are some of the many types of investments you could look into.
Low-budget investments are ventures that do not require huge amounts of funds. Most beginners usually choose bonds in testing the waters of the sea of investments. Issuers of bonds are the government, government agencies, and corporations. When an entity issues a bond to you, it is essentially making a loan with a contract containing a stated amount, interest, and the date of payment.
Bonds are less susceptible to fluctuations unlike stocks, which prices are subject to market changes. The main disadvantage of bonds compared to stocks is that you cannot pull out your money before (and it expires after) the contract date.
Newbies in the industry also prefer mutual funds where companies pool money from venturers and invest them in stocks, bonds, and short-term debts.
For those who would like full control over their money, putting up a small business is the perfect option. It is tied to greater risks but it also makes room for more experimentation and personalization.
The exponential growth of technology in the previous decade has also brought significant changes in how people transact financially. The emergence of Bitcoin, digital money that uses blockchain technology, made a sound in the recent years because it revolutionized how we see money. It is like stocks. But without a regulatory institution, cryptocurrency is highly risky. The wide use of this technology, however, could determine the form of future of financial investments and must not be disregarded.
Passive Income Investments
If you are a risk-averse person who likes to invest big, you would more likely be open to passive-income investments. An example of this is E-commerce websites. Although highly concentrated, online shops are extremely relevant and it is open for all imaginable industry. A real estate investment is an alternatively wise option. Land is an appreciating asset and buying a house and lot gives you the benefit of living in it while it also appreciates.
For big risk-takers, venture investment might be just for you. Venture investors fund other people’s promising business pitches. In a nutshell, it is providing fuel to run a great idea.
Investment returns do not always have to be monetary. Education is one of the best investments one could make. It may be furthering your studies or taking courses to expand your knowledge and skills. It is, in a way, also making yourself competitive in the workforce market.
These are only some of the many types of investment you can venture into and the takeaway from all of these is that risk is always proportional to returns and any type of investment requires resources, time and effort. Are you ready to invest in 2020?
Keep it here at Camella, where your investments grow with you. For more information, go to @CamellaOfficial on Facebook and Instagram or contact us at 02-3CAMELLA or 0945 527 9867 and 0926 915 9138. You may also send us a message at www.camella.com.ph/inquiries/sales.