Four good reasons to invest
Investing and earning money: everyone dreams about it, does it or tries to do it. This makes sense, as there are many reasons why it is worth investing. First of all, let us debunk some myths. You should be sure to read this if you plan on investing.
1. Saving is not profitable
Why do you save money? In order to have money later. But 'later' means something different to everyone. The purchase of a new car in six years? Building a house in ten years? Or a supplementary pension in twenty years? While these objectives are very different, they have one thing in common: they do not concern the near future.
A reserve of money in a savings account offers security. Your money also remains available. However, the return on a savings account is minimal, which makes it very difficult to achieve your goal.
If you do not need your money immediately and want to save for the longer term in a more profitable way, investing is a good alternative. Investing has become the new way to save. The range of investment opportunities is wide, both for defensive investors who do not want to take significant risks and for more dynamic profiles. But we must never lose sight of the long-term perspective. You should also take into account that if you aim for a high return, the investment risk increases proportionately.
2. Investment is not an activity reserved for the rich
It is wrong to think that only people with a lot of money can invest. It is true that wealthier investors can afford to take more risks (losses), but investing with a limited budget can also produce good results. Today, there are many investment products the market which do not require a large investment.
Before investing your money in an investment product, determine how far you want to go in terms of risks and how long you want to freeze your funds. You should therefore have your investor profile drawn up. This is an obligation for anyone who wishes to sell you an investment product. Based on this profile, you will be able to choose a safer or riskier investment.
3. Investing, but not only inequities
Investment is often associated with shares. Shares make people dream of a "good deal". However, you can invest in many other financial products. These include bonds, property or energy. Distribution is the golden rule of a good investment. If you put all of your eggs in the same basket, you might achieve a good result, but you might also end up with an empty basket. Financial institutions often offer products which invest your money in investment funds. Mixed funds have a diversified composition (equities, bonds and cash, many regions, various sectors, etc.), which allows the risk to be limited.
You can invest in funds via an insurance policy. This is referred to as branch 23. This does not offer you a capital guarantee, which means that you are taking a certain investment risk. You must contact a broker if you wish to take out such a policy. He or she will find an investment solution which matches your profile.
4. Beginners can also invest
Equities, bonds, structured funds, etc. All of this seems very complex. If you have never made any investments, it is best to consult a specialist beforehand. He or she will help you to establish your investor profile and explain the different products and possibilities. But it is also a good idea to look for information yourself. You can keep up to date with financial news on the internet and in newspapers. You can also search for legal documents concerning products, such as information sheets. You will also find an abundance of literature on the market to guide you through the wonderful world of investments.
Discover more here about branch 23 products with NN.
