Top 5 benefits of investing
From our childhood days, we are taught to save money from our pocket to buy the belongings we desire the most. This mentality leads to the age of maturity and we try to save money for what we love most. But here we make a drastic life mistake that makes the difference between being successful or reduced in terms of financial expansion.
To understand investments; First we must define the investment.
What is investment?
According to Investopedia, an investment is an asset or item that is purchased with the hope that it will generate income or appreciate in the future. In an economic sense, an investment is the purchase of goods that are not consumed today but are used in the future to create wealth. In finance, an investment is a monetary asset purchased with the idea that the asset will provide income in the future or be sold at a higher price for a profit.
What are your top 5 benefits?
1) Financial Independence
Financial independence means that you have enough wealth to live without working. Financially independent people have enough income generating assets without any physical labor as their money works for them.
How to achieve Financial Independence?
Here are the best tips for becoming financially independent:
· Try to increase your income.
· Plan your savings each year.
· Select profitable investment options.
· Decide your financial goals.
· Try to stay away from loans and debts.
2) safeguard against inflation
Inflation is a sustained increase in the general level of prices for goods and services in an economy over a period of time. It can be thought of as the aging of the value of money over time.
In Economics, inflation reflects a reduction in purchasing power per unit of money – a loss of real value in the medium of exchange and unit of account within the economy.
The value of assets continues to rise due to inflation. As a result, investments are not only safe but also increase over time. Therefore, it acts as a support against inflation.
3) Achieve Financial Goals
When we invest, we reserve our money for long-term goals, such as retirement, an international vacation trip, a luxury home with a car, or a child’s education.
Investments ensure that we achieve all our long and short term goals in a precise time.
4) increase wealth
Investing is not a get-rich-quick way. It takes time, patience and awareness. It requires analytical studies of the available opportunities and makes well-versed decisions on where to place your investment so that it provides big returns. If things are done in one place in order, the results are almost guaranteed.
5) Provide a source of income
Some funds were specifically established to provide investors with a monthly income, while others, like many real estate funds, also pay monthly dividends.
Most monthly income funds try to offer 11 monthly installments 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 forms of Investments?
The suitable investment options are indicated below:
· Real estate.
individual actions.
Investment funds.
· Corporate debt.
· Government bonds.
Raw Materials (Gold, Silver, etc.).
Liquid Funds.
· Fixed deposits.
