One of the best reasons for anyone to invest is so that they will not have to work until they die. The bottom line is that there really are only two ways for you to make money. You can work for it, or you can have your assets do the work for you.
Let’s take a peek at some of the assets that can help with this and give you an idea of how to start investing.
Photo by William Iven on Unsplash
Cryptocurrencies
This is one of the newer options when it comes to things you can invest in and you’ve probably been hearing a lot about it. Basically, a cryptocurrency is virtual money. The crypto part of the word comes from this type of digital money being regulated by encryption in order to regulate each unit and to verify when the funds are transferred. This type of money operates independently from any type of bank and relies on blockchain technology to ensure that everything is above board. If this is something that you would like to invest in, there are basically two ways to do just that. You can buy it outright, or you can mine for it by using a company like Genesis Mining.
Stocks
Stocks are considered to be a long-term investment vehicle. To put it simply, they are a way for individuals to be part owners of a business. Each share of the stock is representative of a share of ownership in said company. When the value of the business fluctuates, so does the value of the shares, or stocks, in the company. The idea when investing in stocks is to buy them when the prices are low and then sell them when the prices get high.
Mutual Funds
Mutual funds are actually a way for a group of investors to pool all of their money for investments to buy things like stocks, bonds, real estate, or anything else that the fund manager (person who oversees the fund) decides would be beneficial. With mutual funds, instead of each person managing their own money, the responsibility of that is given to a professional.
Bonds
Bonds can actually come in a variety of forms. They can also be called “fixed income securities” because of the fact that the income they generate yearly is set ,or fixed, when the bond is purchased. Bonds are basically instruments of debt. To get a bond, you are actually loaning money to a corporation or government body. The income generated from bonds is basically the interest for the loan. After a predetermined amount of time, the bond will mature and you can cash it in for the money.
Savings Accounts
Most people might not think that a savings account can be an investment. The thing is, they earn interest, which means that your money is working for you, and that makes it an investment. That being said, the interest rates tend to be rather small, so they won’t earn you very much, but they do earn more than when you just hide your money in your mattress.
Money Market Funds
This is a special sort of mutual fund that is invested in bonds that have extremely short-term bonds. This isn’t like most mutual funds because each of the shares in a money market fund have been designed to be worth a single dollar at all times. This type of fund typically pays interest rates that are better than what banks offer, but they earn less than CDs.
CD – Certificate of Deposit
This is a special type of deposit that you make at a financial institution such as a bank or credit union. Interest rates on CDs tend to be around the same figure as intermediate or even short-term bonds, but this will vary based on the length of the CD. With a CD, interest is paid at predetermined intervals until the maturation of the CD, when you will get back all of the money put into it along with the interest that has accumulated. When you purchase a CD through a bank, it is insured up to $100,000.
Investing really doesn’t have to be difficult, but you do need to put a bit of elbow grease into it, in the form of thoroughly researching any investment opportunity.
