Not being in the market can be costly!
Are you in the market? If you are not investing in the stock market, you could be losing money. The fact is, the stock market offers one of the best ways to build wealth, no matter which market you invest in around the world. It is important for you to consider how to invest, and where your best opportunities are. Yet, when it comes down to it, there is almost no better type of investment to have in place for wealth building. Before you make any move into investments, speak to your financial adviser. Find out what the best options are for your specific needs. Then, consider the following.
Why Not Just Keep Money in the Bank?
The easiest way to earn money used to be to put it into a basic savings account and let the interest grow the value of the deposit. This is safe, as there are few if any risks involved. And this method allows you to have access to those funds when and if you need them. While this sounds good, it is not lucrative for most people. Today’s interest rates are very low, meaning you’ll have to wait a very long time to see the returns you need. In short, the time frame needed for this type of investment to appreciate is simply too long for most people’s needs. Click here for the full article on keeping your money in the bank.
What About Other Investments?
Bonds offer some risk and lower returns. You could buy into real estate, but you’ll find that property prices are only rising slightly at best and only in some areas of the world. The process of liquidating this type of investment can be hard to do, too. You could buy gold bullion, but that’s not always as likely to be beneficial.
The Benefits of the Stock Market
The other option that works very well for many people is an investment in the market. The stock market provides a clear opportunity not just to earn money, but also to set the level of risk right for you. For example, there are relatively more cautious stocks available that you can buy, coupled with diversification. Buying these can help you to minimise risk while still working to increase your wealth at a faster rate over the medium to long term than any of the other investment instruments listed previously. In short, risk can be moderated by choosing the right types of stocks for your individual circumstances.
Additionally, time is on your side with the stock market. Historically speaking, stocks have continued to grow in value across the board in the long term. Those people who are in and out of the market frequently, making changes to their portfolios, are less likely to achieve the value that long-term investing offers. There is no way to guarantee that you will see significant returns on stocks, but it is likely that you will see the value of diversified stock holding go up given a significant time.
If you put money into the stock market right now, you would have to invest significantly less in stocks than you would have to put in the bank to achieve the same return. If you have time on your side, you have one of the best investment tools available to you.
You do not have to have a lot of experience to invest wisely. The internet makes it easy to do research and make wise investment decisions. If you have not done so yet, talk to your financial adviser about how you can enter the market to achieve your long-term financial goals.
About Mike Coady
Mike Coady is an expat expert based in Dubai and is on hand to help with all of the above and more.
Mike is an award-winning money coach and industry leader in the financial sector.
Qualified to UK Financial Conduct Authority (FCA) standards, a member of the Chartered Insurance Institute, a Fellow of the Institute of Sales Management (FISM), a Fellow of the Association of Professional Sales (F.APS), a Fellow of the Institute of Directors (FIoD) and featured as a highly qualified Financial Adviser in Which Financial Adviser.
To learn how to choose a great financial adviser, download our free guide.
Blog published by Mike Coady.