If you’re new to the world of investing, knowing just where to put that money that’s burning a hole in your pocket can be a terrifying thought. It shouldn’t be down to any one person to tell you how to invest your money. Investment is very much a personal process – the losses and gains are the results of your own decisions.
But if you don’t know anything about the world of investing, it can be easy to jump the gun and make poor choices. Being as uninformed as you are isn’t ideal in a world that is based mostly around calculated decision making.
Once you’ve asked yourself three important questions, you’re ready to go. But where exactly do you put your money? Here are three potential ideas to get you started, and the pros and cons of each:
Buying to let is one of the most popular choices for a smart investment. For the most part, it’s risk-free, and you’re guaranteed a monthly return to supplement your income. The only real downside is the chance of house prices dropping, but riding the storm should see you through it.
Before you visit any property auctions, you need to work out a couple of things. Your budget is your primary concern. You should always allocate enough money to deal with maintenance and repairs. As the landlord, this responsibility often falls on your shoulders. It’s wise to invest domestically, as international purchases can produce some potential pitfalls.
Oil investing can be a very lucrative venture, but it’s also a volatile market. If you’re something of a gambler, investing in oil could be for you. There is the small chance of losing most of your investment, but if you strike rich, the returns are phenomenal.
Many men before you have made their millions from the oil trade. It’s one of the most sought after commodities on the planet. And, generally speaking, it has a pretty good track record of riding out dips in form.
Perhaps the most glamorous of investments, thanks to the memoirs of Jordan Belfort in recent times. Okay, so playing the stock market isn’t all about luxury yachts and exploiting little people. It is, however, a game of chance.
When it comes to the stock market, there’s as much chance of an investment paying out as it is to collapse. You can spread the risk to maximise returns.
It’s important to remember that you don’t want to beat the game, you just want to play it. Quite often, the most secure investments are the ones that are performing well. Of course, this saturates the market and means fewer returns, but it’s the safe bet. If you don’t want to take much of a risk, this could be the tactic that suits you most.
Recruiting the assistance of a financial adviser would be a wise move. Nobody wants to see you lose money. But it’s important that you fully understand the market before you put your money in. Naivety could ultimately cost you. Preparation is the key to investment.