Saving for the future is not a choice, it is a MUST!!!
TIPS ON WHERE TO PUT YOUR SAVINGS
ON my first blog, I've discussed some ways how to save and make it as a
habit. If you have started setting aside a portion of your income mainly for
your savings,let me say CONGRATULATIONS! You just made your first step
towards achieving your financial freedom.
Now, the greatest challenge is where to put that money so
it would yield much higher return.But first things first, you need to ask
yourself these important questions:
> what is my goal or objective?
> How long will I invest
> Am I ready to take the risk?
Goal setting - It is very crucial that you set an objective before you start investing because that would be your guide all throughout.That would serve as your motivation.It may be for your child's college education, dream house or if you just want to retire early.
Timeframe - This depends on your goal and your age.The younger you start,
the better.In IMG, we encourage people who just started their job to start
saving and investing so they can retire even at the age of 40 and enjoy the
fruits of their hardworks.
Risk tolerance - All investments/businesses have risk.In
other other words, there is no such thing as "risk free investment".You just
need to learn how to minimize it.If you take higher risk, then you get higher
return
Where to Invest?
Savings Account
There are a lot of investment vehicles that you can ride on. The most
common type is savings account or time deposit that most banks offer. This is
the most liquid among other investment, meaning you can withraw the money
anytime (On maturity date, for time deposit) and it is low risk investment
especially if you put in commercial banks. But the downside is they give the
lowest return.It s normally below inflation rate.That means your money is
not growing because it is being eaten up by inflation.The value of your money
decreases.Inflation, in layman's term is the general increase of the prices of
commodities.
Real property
Acquiring property is another type of investment.They say that real
property is the best investment because the the value appreciates.In a way, it
is true.However, we also need to consider the recurring fees associated with the
property like monthly dues, taxes, maintenance and others.And if you decide to
sell it, you will need to pay to transfer the property to another person and of
course taxes.Furthermore, it takes a while before it can turn into cold
cash.
Business
Getting into business is another way to grow your money.But before putting up
any business, there are a lot of things you need to consider.Otherwise, it will
fail. As a rule, you should know the business by heart.Don't just go with the
trend.You must be familiar with the product/services that you are going to
sell.I strongly recommend not to go beyond your passion or your talent.That is
your core gift that God gave you and it has purpose so you might want to
monitize it.If you love cooking then food business may be the best option. If
you are good in art, you can get into printing business.Whatever business you
have in mind, you have to enjoy doing it because it is your passion.Money will
follow afterwards.
Stocks/Mutual Funds
Stock market and mutual fund are another vehicles you may be interested
in.Peolple think that getting into these types are only for rich people and is
complicated.Honestly, that's what I thought as well until I joined IMG.To
my surprise, It is very easy to understand and you dont need technical skills to
invest.You dont even need to take a close watch at the market.Same thing goes
with stock market investing.You just need to know the basics.THAT'S IT!The best
thing about it, it yields high return around 10-20 percent compared to 1% if you
put it in the bank.
BUt hold your horses! Let me remind you that before you invest, you have to
create a solid financial foundation otrherwise it will collapseIt is like
building a house.You need to build a strong foundation so even if an earthquake
strikes, it won't get destroyed easily.You have to protect yourself first.If you
don't and if something happens to you,like if you get sick, all your investment,
all the money that you worked hard for will be wiped away, instantly.
There are other investment opportunities that I will be covering soon. I just presented the most common ones.
At IMG, we teach people the proper way to invest.If you
don't follow the principles, you might end up losing your
money.Remember,Financial Literacy is the key to manage your finances
effectively.
IF YOU ARE COMITTED TO SAVE AND INVEST FOR YOUR FUTURE, CLICK HERE
"For I know the plans I have for you," declares the Lord, "plans to
prosper you and not to harm you, plans to give you hope and a future."
Jer 29:11