According to the main principles of personal finance, one way to build wealth is to invest your money. That's right, it is useless to have the money stored in the mattress if it is not going to grow and increase in value, on the contrary, inflation will take it away.
That is why here we will help you learn where it is best to invest your money in order to make it grow. We will tell you what are the 4 places to make your money generate returns and thus grow and grow. Now you can say goodbye to debt slavery!
▶ Number 1: Real Estate
One of the preferred options for people is real estate investing. This due to the security offered by having a land or a building as a backup. In addition, there is the idea that real estate does not depreciate, on the contrary, with the passage of time its value increases.
This is not always the case, since there are cases where properties lose value due to situations such as natural disasters. Another frequent case is that people buy real estate to resell or rent them And, not being able to do so, they end up auctioning them off because they carry the mortgage debt.
There are many options to invest in real estate, one of them is the purchase of land or land, plots, etc. You can also buy buildings such as commercial premises, offices, buildings, apartments, rooms and houses. To generate returns you can resell said properties or rent them, Por ejemplo.
Before investing in this segment, we recommend that you inform yourself well, since there are many points to take into account. On the one hand, you have the characteristics of the property, on the other hand, the characteristics of the area, the future projection, regulations and even the cost of buying and putting said investment to work.
▶ Number 2: Open a business to invest
For many, this is one of the most satisfactory investments that we can find, since investing in this segment is a wonderful path that you will undoubtedly enjoy. And it is not about opening a business to open it, it requires a lot of work.
Here the options are many, you can open a business focused on selling products or selling services. What we recommend is look for a niche market, For example, vegan first-time moms, then you focus on finding a need like feeding your baby vegan milk, then creating and selling the solution, plant-based milk formula.
Remember that the path of entrepreneurship is easy because it involves a lot of constant work, breaking stones and paving your way. One of the virtues that will undoubtedly help you the most in this process will be patience because this investment is rather medium and long term.
Another piece of advice we should give you is that don't live from your business, or withdraw from your earnings, at least the first year of operation. This is because the profits must be used for reinvestment to make the company grow.
▶ Number 3: Invest in financial instruments
Investments in financial instruments are another option that is becoming increasingly popular. This is due to the fact that the arrival of the internet has made this type of investment instrument much more accessible, thus facilitating its use and understanding.
While there are instruments that offer low profitability such as bank promissory notes, which usually do not exceed 7% per year, there are others that are very profitable. A perfect case is binary options which can give returns higher than 75%, yes, with a much higher risk.
That is why this option is recommended only when you have the necessary knowledge and experience to be able to make adequate decisions. The advantage is that solving this point today is much easier. On the internet you can find hundreds of courses, books and even demo platforms to learn how to invest in financial instruments.
Also, the options are many. For example, we can invest in the stock market by buying shares of all kinds of companies. Another good way to invest in financial instruments is through currencies or Forex. Mutual funds and debt bonds are some more options to diversify your investments.
▶ Number 4: Other investments
Finally, we can mention other types of investments which group assets that can be a way to increase your capital. A very common option is to invest in Crowdfunding platforms or cross financing. where a good return is offered with little investment.
Investing in physical assets, for example, can be a good way to give your money a backing and thus grow in value over time. For example, you can invest in gold by buying some coins or jewelry and storing it in a safe at the bank.
Some additional alternative investment options are in antiques and art, options that, although rare, can be a good way to invest. The antiques, instead of losing value, usually gain it for being strange objects of the past. Works of art also tend to acquire a lot of value over time.
It may seem strange, but another good option to invest is in your education. That's how it is, education can be a good way to generate more wealth by giving you the necessary knowledge to grow professionally, for example. This will help you generate more wealth by having a higher professional hierarchy.
▶ How to choose the best investment?
To choose the best investment first you must ask yourself what are your needs and expectations. There are people who are looking for short-term returns, for example, and other more patients who prefer slower returns, but also more secure.
Another point that you should assess is your budget, since investing in real estate, for example, requires more money than doing it in financial instruments such as Forex. What's more, you must value your knowledge, how much do you know about the market and the way it operates. The best option is to consult with a professional to make the best decisions.
Financial analyst and economist with a master's degree in finance.