You’ve probably heard a lot of people talk about investing and what a great way it is of making your money work for you. And the fact of the matter is, it’s true! If you can afford to invest even a little bit, you should definitely consider it. Many people write investment off as a moneymaking or pyramid scheme, and therefore never even consider it. While it is true that some investment opportunities can be fraudulent, there are many legit options out there. You might still be on the fence about it, not sure whether you truly want to commit to investing and take the leap, so keep reading for more reasons why you should consider it and what it can do for you.
There are various options
One of the great benefits of investing is that there are so many different ways of investing that you’re sure to find one that suits your needs. A lot of the times, people are under the misconception that, to be able to invest, you need to have a small mountain of money. Luckily, this is not true. You can invest whatever amount of money you’d like to – big or small. In fact, you can invest your money however you see fit. You can pick between long-term or short-term investments. You can invest through many different ventures, and if you’re scared of the risk, your best bet is a GIC. If you’re wondering to yourself, “What is a GIC?”, it’s a guaranteed investment certificate and one of the investment options with the lowest risk.
Building up good habits
Investing and saving go hand in hand, and both are great habits to have. By investing a little bit of money at regular intervals, you’ll be getting into the habit of saving some money each time you receive any. This means your savings will always be growing unless you withdraw money from it, and you’ll be learning how to manage money responsibly along the way. Having a decent amount of money saved up or invested can also boost your total net worth and improve your chances of being approved for financial loans.
Reach your financial goals
We all have goals that involve big quantities of money, and sometimes they seem entirely unattainable. You might have a goal of buying a house, and that may seem like a goal you’ll never reach. However, by investing a certain amount of money each month towards that specific goal, you’ll be able to reach it within a reasonable time period. Having financial goals, both long-term and short-term, will help you manage your money better and make you excited about investing, since you know what you’re investing for.
In case of emergency . . .
Life happens. People lose their jobs, have unexpected pregnancies, or sudden medical emergencies. When this happens, it can add to your stress to know you have a heap of bills waiting for you, and no money saved up. Depending on what you’ve invested in, you might be able to use the money from your investment to pay for whatever unexpected situation has occurred. Or, you can start a savings account specifically for emergencies, and invest a certain amount of money into it each month so that you know you’re covered if an emergency should happen.
You’re building your future
By putting away a little bit of money now, you’ll be ensuring a better future for yourself. Whether this means having enough to money to put down a deposit for a house or car, or being able to ensure that you or your children can afford the best quality education in a few years, investing is a surefire way of planning for your future. You can also start saving up for your pension, so that when you reach retirement age, you don’t need to worry about how you’ll be able to afford everything you need. So, start saving for your future now and you won’t regret it!
Grow your money
Of course, this is the most popular and obvious reason for investing. Having some money is great, but being able to turn that money into more money sounds too good to be true! Luckily, it can be true, if you invest it properly. Sure, you might have to wait a while to truly see the effects of your investment, but your money will definitely be growing over time. Investing is one of the best ways of making your money work for you and getting the most out of it.
When your money is invested in a venture, you can usually only get it back under certain conditions. This can sound terrifying – what if you need your money immediately? That’s why it’s a good idea to have different forms of investments, somewhere you can instantly access your money, and others where you need to wait a while to get it. You might be thinking that waiting to get your money is a con, rather than a pro, but the truth is that it will force you to think about whether you really need the money. This is especially helpful for people who are impulsive when it comes to spending money, since they’ll need to reevaluate whether it’s the smartest financial decision.
This is of course dependent on the type of investment route you decide to go for, but if you invest in stocks or something similar, you’re not the only investing in that venture. This means that the profit will be split, but so will the losses, if there are any. The great part is that you get to decide how big of a risk you want to take, since the gains or losses are proportionate to how much you invested in the first place. To sum it up: you can invest a lot of money and stand a chance to earn more income, but also stand the risk of losing more money, or you can invest less which leads to smaller returns but also a smaller risk, so the choice is yours.