Times are dire today. Rumors of markets crashing, inflation skyrocketing and crises rising are enough to make one’s hair stand on its end. Your pockets are almost suffocating with the tightness of your budget, and you wake up every day praying that no other “unforeseen” situation arises, You spend hours and hours of your life earning money, only see to it vanish as quickly as smoke vanishes into thin air. Bills seem to add up every month no matter how hard you work, but your income magically stays the same despite all the whining you do to your boss. You wonder if there’s any end to this exhaustive cycle; how can you save money when you barely even have the money to cover the essential expenses?
Debt traps are all around; simply having a piggybank no longer works for today’s economy. Hiding a jar full of coins seems cute and cuddly but money moves so fast these days that such a savings plan won’t really get you anywhere except for a roll of candy floss. Pity the day these 5 year olds find out. If you are tired of this earn-spend cycle, but don’t really know any saving and investing strategies besides getting a piggybank, then here are few tips to help you dispatch that extra money safely without it rotting away.
Never depend on a single income. Make investments to create a second source.
1. The Piggybank Way
Nothing beats a classic, huh? This is more about getting you into the “saver attitude” rather than giving you actual returns. This conditions you to always consider setting aside something, no matter how small, as a preparation for future concerns. Many people live by the “day-to-day” principle, where every payday seems more like an accountant’s licensure exam; exact amounts or figures up to the “nth” degree in order to just fit them into the budget. Having a piggybank reminds you to not spend entirely your salary or income, and unconsciously trains you to always “save” even without having any definite object to spend it upon on.
2. Ensure Your Insurance
It’s not like we’re asking for it but… we never know! Though money is not really “growing” (in the business sense) in an insurance plan, the return there is much, much better. You see when you enroll in an insurance plan, you are actually minimizing the impact of an unforeseen circumstance, thereby preventing you from spending more money. It is an investment that does not really give any tangible result but over-all reduces the risk of you being broke and crying on the side of a street for the homeless.
3. Seek Expert Advice
You think investment is just all about having money, putting it somewhere and waiting for it to grow? After you have imbibed the saver’s attitude, and made sure that a portion of what you earn is always on high alert mode, then it’s time to look for those confusing chaps named stockbrokers, ask them simple questions and listen to them give even more confusing answers. Though you may not necessarily understand everything that they are talking about, at least you can have the consolation that whenever you lose all of your life’s savings, you can attribute it to dumb misfortune or his failure to explain well the difference between cheap and blue-chip stocks.
4. Don’t be stupid
Seriously though. The science of investment is much simpler than it appears to be. Educate yourself. For the record, we have already invented this online platform called YouTube, where thousands of gurus offer “investment for dummies” courses. All you have to do is listen. And bring snacks, Don’t depend on whatever anybody says about the stock market. The rule there? Never believe what the market appears to be.
5. Risk Cautiously
Now since this is not intended to become an all-encompassing tutorial on investment and whatnot, do pardon us for not going into detail about this. But putting your money in low risk avenues like treasury bonds and bills is a good way to go. Oh no, don’t expect to become the next Bill Gates after investing here. But if you are beginning, or are merely testing the waters before venturing into larger/higher risk investments, treasury securities are one of the best springboards.
6. Invest At The Right Time
When do you know that it is the right time to finally let go of some of that hard-earned ka-chings? When the economy is generally healthy, inflation is stable and trading is booming. You don’t have to earn a bachelor’s degree to know about those things. They could be found in the daily newspaper, for heaven’s sake. Read.
Now there you go. Investing is always a risky business, and the risk there depends upon the amount of money that you have given. But proper preparation, even to the smallest and most minor of detail, can make all of the difference in the returns that you will gain. Even the most remote of aspects could matter if one really intends to make investing a serious hobby. This article then hopes to have given you that, not just another list of where and what to invest but the hidden factors that sway these results as well.