Do you want to be in charge of your own financial investment opportunities? Will you invest through the stock market, real estate, or another way? There are many ways you can take charge of your own financial wealth. Whether you decide to allow a financial advisor to be in charge, you do it yourself, or both, you have options.
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What Are the 4 Types of Investments?
If you’re going to be in charge of your own financial investments then you need to know what you can do. In fact, there are more than four ways to invest. So don’t be tied to just 4. There are:
- Real estate
- Precious Metals
- Stocks
- Bonds
- Mutual Funds
- Equites
These are just a few ways you can invest. If you want to buy digital gold or have gold bars, then you can. Especially when you take matters into your own hands. But if you’re going to be in charge, then make sure you know what you’re doing. Be smart with your money!
Do You Know Where to Start?
Have you ever found yourself at the annual family BBQ and the topic quickly turns to money? Your brother-in-law Dave, who for background information, has done quite well for himself.
Some financial investment, a lucky break in the stock market, or something. Now he’s cruising around in his fancy new BMW not to mention the yacht and vacations to Europe. You’re secretly envious; perfect kids, perfect wife -well it is your sister, perfect house, and even the perfect dog. You want to gag.
Your always eager cousin is asking for investment advice. Should he go long on Facebook? What about the trade wars with China, will it impact his portfolio? You’re standing there trying to figure out if you should say anything at all. Do you admit you have no idea what a stock, mutual fund, or ETF even is? Heck, you don’t know what ETF stands for. You suck up your pride and admit you need help.
Similarly, your cousin Peter is standing there not saying too much either. You assume he feels the same way as you. Having slaved away for the past 25 years in his plumbing business, he must be feeling the pinch as well. I know you can relate to this situation.
What’s Your Mindset?
Pop quiz. Which of these do you agree with?
- Most millionaires inherit their money
- You need money to make money
- There’s no way Peter can be a millionaire
- You should invest 10% of your income
- Anyone can become a millionaire
If you agreed with the first three statements, you’re coming from a fixed mindset. If you agreed with the second two, you’ve got a financial growth mindset. Don’t fret, though. Today I’m going to show you that with the proper financial investment and guidance, you can have what Dave has. Perhaps even more.
Let’s Define Financial Investment
The idea behind a financial investment is simple. You put money into an asset with the hope it’ll appreciate, “grow” over time. When the time comes, you sell it at a higher (hopefully) price.
During all this time you earn money or dividends just by owning it. Take Microsoft stock, for example. Say it pays a dividend of $5 per share. You own 500 shares. Do the math, and you get paid $2,500 just for owning the stock!
It’s a win-win all around. Now, it’s your choice what that asset is. Some people prefer to put their money into assets like stocks, mutual funds, and real estate, to name a few. They can make that financial investment themselves.
Or they can pay someone from say Fidelity to manage their portfolio for them. Things like 401Ks are typically managed by someone. But on occasion, someone will take matters into their own hands.
Again, if you’re playing with your retirement, then you have to know what you’re doing. Are you saving money? I chuckle as I write this thinking of the song “Bills, Bills, Bills” by Destinys Child. And sometimes that feels like my life, haha.
For many, the thought of saving even a $100 a paycheck is enough to induce anxiety or at least the lyrics to the song. Between the heating bill, groceries, cell phone, car payment, the new roof you need – I get it, money’s tight, and you can’t afford to “invest.” But let me tell you this; you can’t afford not to.
I’m Already Saving Why Do I Need to Invest?
Many think that put putting money away each paycheck into their savings account is investing. I hate to break it to you, but you’re not investing. Many bank owned “savings” accounts have dismal interest rates – think 2%. What sets a financial investment apart from your “savings” is the value of time. Or what time signifies. Enter what Albert Einstein said was the 8th Wonder of the World: Compounding Interest.
Think back to the questions above, “most millionaires inherit their money” or “you need money to make money.” Or better yet, I’ll start saving later once I pay off my credit card…. you get my point. The truth is, you don’t need much money to get started because compounding interest can make you a millionaire. With the right financial investment, anyone can become a millionaire, especially if you start young.
Take your quiet cousin Peter for example. Peter is the proud owner of “Pete’s Plumbing” for the last 25 years. At the age of 25, he opened his business, got married, bought a house, opened an investing account. Needless to say, it was a big year for Peter.
For the last 25-years, Peter’s been diligently socking away 10% of his $50,000 per year income. And since he set up automatically bi-weekly withdraws from his checking account to his investment vehicle of choice; stocks. He didn’t notice the money was gone.
Fast forward to 50-year old Peter sitting on his deck with his wife dreaming about retirement only 15 years away. Assuming conservative returns of 10% in the stock market, by saving and investing only 10% of his income will have a staggering $2,434,221 at 65!
Now, this number can be a lot more if he saves and invests more, but you get my point.
Final Thoughts
Shockingly, the average American within 15-years of retirement age saves at only one-third the rate required to maintain their current standard of living. Even if you only have 15 years left to retirement, start saving and investing now. Do not underestimate this power.
I don’t think I’m alone in my feelings about compound interest. If you’re not saving and investing, you’re missing out on one of the biggest secrets in life. Merely saving and investing small amounts of money in the stock market every month over time is a sure-fire way for people of modest means to become financially independent. Just look at Peter. Pete’s a smart guy who even googled purell hand sanitizer stock during the pandemic.
Sadly, human has a great way of rationalizing their actions. We don’t tell ourselves, “I’m never going to save and invest.” Instead, we say, “I am going to save and invest; I’m just going to start tomorrow.” Don’t start tomorrow; let us show you how now. Whether it’s day trading stocks, options or swing trading both we are here to guide you. Click here to assess our great trading community and get started today.
