Wednesday, May 23, 2018

Got some money to invest? Five ways to make it work harder

The past decade has been a difficult one from an investment perspective. Tough economic conditions meant fewer of us had spare finances to invest in the future, and even for those that did, low interest rates made it a challenge to find an investment that would generate a reasonable return.

This has led to a rise in alternative investment ideas, but has also thrown the spotlight on one of the oldest strategies of all. If you have come into a little money and are uncertain what sort of investment strategy to follow, here are some ideas.

1) Gold remains the safest investment

Today’s currencies might not be measured against the “gold standard” but the fact that we still use the phrase to define the ultimate in valuation tells you all you need to know about the precious metals market. When all else fails, gold holds its value and enjoys steady appreciation.

You can buy gold in a variety of forms, from collectible coins to traditional gold bars weighing anything up to a kilogram, and this website will tell you everything you need to know about how to do so.

2) Don’t overlook the stock market

Investing in the stock market might sound a little 20th century, but plenty of people are still doing so today, and enjoying success. Nobody is suggesting you should invest everything in stocks and shares, but by trickling a little money every year into some carefully selected investments using a technique known as dollar cost averaging, you can limit your risk and come out with a tidy profit.

Even if you don’t know much about the stock market, there are virtual brokers, sometimes known as robo advisors that will help you make the right choice.

3) Real estate

Recent years have seen an explosion in private landlords, as individuals have sunk their money into investment properties. The arguments in favor are compelling – after all, this is an asset that will appreciate in value and will also bring in a healthy monthly rental income. Surely that’s a win/win?

That’s true as far as it goes, but bear in mind that being a landlord has additional cost and hassle factors that other investments do not. You’ll have maintenance and repair issues to deal with, as well as the potential risk of problem tenants. Also, real estate is not at all liquid, so you need to be comfortable with the fact that your money is tied up for the long term.

4) Invest in yourself

Your biggest asset could be yourself. Invest money in getting better at what you are good at, both personally and professionally. You won’t just be making yourself more marketable, you’ll also experience the benefit of improving yourself finding out what you are really capable of – and ultimately, that is something you can’t put a price on.

In the final analysis, it is not a case of choosing from the above options, but of spreading the risk and investing money as widely as possible. That allows you to get the best from all worlds.

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