From childhood, we are taught to save money out of pocket to buy the things we need most. This spirits envelope is mature and we are trying to save money for what we need most. But here we make a drastic mistake of life that makes the difference be successful or reduced in terms of financial reinforcement.
To understand the investments; We must first define the investment.
What are you investing?
According to Investopedia, an investment is an asset or item purchased with the expectation of generating or appreciating future income. Economically, an investment is the purchase of goods that are not consumed today but will be used in the future to create prosperity. In the world of finance, an investment has been purchased as a monetary asset with the idea that it will generate income in the future or be sold at a higher price for profit.
What are the 5 main benefits?
1) Financial independence
Financial independence means you have enough wealth to live without work. Financially independent people have enough assets that generate income without physical labor because their money suits them.
How to achieve financial independence?
These are the best tips for being financially independent:
- Try to increase your income.
- Plan your savings each year.
- Select profitable investment options.
- Determine your financial goals.
- Try to stay away from loans and debts.
2) Protect against inflation
Inflation is a sustained increase in the general level of prices of goods and services in an economy over time. It can be considered as aging the value of money at a time.
In the economy, inflation reflects a decline in purchasing power by currency – a loss in fair value through the currency and unit of account in the economy.
The value of assets continues to rise due to inflation. Therefore, investments are not only safe, they also increase over time. That’s why it acts as a support against inflation
3) Achieve financial goals
When we invest, we divide our money for long-term goals, such as retirement, international vacation travel, luxury home with a car or training for the child.
Investments ensure that we achieve all our short- and long-term goals on time.
4) increase prosperity
Investing is not a way to become rich quickly. It takes time, patience and awareness. It requires analytical studies of the available opportunities and makes a wise choice of where you place your investment, so it gives a great performance. If things are done in one place, the results are almost guaranteed.
5) Provide a source of income
Some funds are designed specifically to provide investors with a monthly income, while others, like many real estate funds, pay monthly dividends.
Most monthly income funds try to offer 11 monthly payments of a similar amount and a 12th that varies. The exact level of income will depend on the performance of the fund.
What are the ways to invest?
The appropriate investment options are listed as follows:
- Individual stock.
- Investment funds.
- Corporate debt.
- State bonds
- Raw materials (gold, silver, etc.).
- Liquid funds.
- Fixed deposits