An investment is a safeguarded portfolio with your money for future use.
Before investing you have to realize that you got options that you need to utilize in order to maximize your returns. The ultimate goal still being to build your wealth for various reasons best known to you.
These include:
1) Explore your investment choices
You can never run out of investment choices. They are various, to give investors diversity and ability to exercise choice. They include: Stocks, Forex, Real Estate (R.E.I.Ts included), Unit trusts, E.T.F’s and Businesses among others.
Which one is for you?
- Your investment needs to describe you, your passion and love for Real estate translates to extra effort put in which in turn leads to success.
- Check your Risk appetite, how far can you go? Can you risk your dream car for the stock market? Investments vary in volatility and the stock exchange just happens to be among the most volatile investments.
- Liquidity should also be your concern as an investor. How fast do you want your money back? If your answer is “not that fast, its a long term thing” then real estate looks like your next stop-by.
2) Weigh your risks and returns.
Most of the time it is usually a “The Higher The Risk The More The Return” assumption… which normally works out even for me but never always.
However, life has taught me how reduce risk and these includes:
- Do your homework; research about the investment.
Ask peers, storm that agency with questions. After all, its your money that’s going to be on the line if you mess up! Consult as much as you can and learn the task. If all these is done, then you got the job done. - Never forget the Tax figures! Most people don’t put this in mind, Profit is only profit if its the net profit! So are capital gains.
- Diversify your Portfolio. Numerous investments exist for you, to be adopted by every investor.
- Consult experts don’t rely on them! Brokers make many from you, so don’t be foolish.
3)Build Wealth
This involves standing The “Test of Time” , whereby you stand to prove that intellectual investing outdoes speculation. Wealth is a reward to investors for making right choices. When the road is bad you average. Literally Value cost averaging as commonly referred to as in the Stock market. Its a way to boost the final outcome with just a little creativity and definitely some extra cash and risk tagged along.
As you build your wealth, its important to also take advantage of Retirement accounts!Most people ignore tax reliefs offered to them. Also, don’t pile all your money into Investments that attract too much attention. Just like when shopping, the best time to buy a commodity is when its lowly priced.
Article first published on Hisa NSE Insights Facebook account.