Creating a financially stable future for yourself doesn’t happen with just working hard and earning money, you also need to make your money work hard for you, and investing is an important way of doing that. It enables you to take charge of your financial security, grow your wealth and open up another revenue stream that will be there even when you retire.
Want to kick start your investment journey? There are many ways for you to go about it. You can invest in stocks, bonds, real estate, or ETFs. When taken seriously, the returns your investments generate can mean a shorter working life and a financially stable future. If those aren’t reasons enough, here are 5 more reasons for you to start your investment journey:
Earning Higher Returns
Investing always comes with a tradeoff. You forego your ability to use your funds in the present, in exchange for higher utility in the future. The returns you enjoy on your investments can benefit you in many ways:
Stock investments can generate returns in the form of dividends or capital gains
Bonds can act as a form of regular payouts or coupons given during predetermined time periods
Real estate investments payout in the form of regular rental income or capital gains.
Creating a Retirement Fund
The majority of investors have one goal in mind- creating a retirement nest egg. It gets difficult to sustain all your growing needs once you retire and don’t have a regular income.
Investing when you DO have money coming in helps ensure that you will have a sum of money to fall back on in the later years of your life.
Investing is a great way of saving taxes! Check with your accountant on what and how much to invest so you can save in the upcoming tax season.
If you leave your money sitting in the bank, its purchasing power begins to decline due to inflation. Investing in a healthy mix of assets can help you grow the same amount by a lot more and beat inflation.
Reaching Your Financial Goals
Every individual keeps coming with your new financial goals. Some may be trying to save up for a new car or a family home, while some might be trying to grow their money to pay for their children’s college education.
Whatever your individual financial goals may be at this point in time, investing in a mix of assets can help build a financial corpus big enough to fulfill all of them.