Many people are scared of investing money, but it is one of the oldest and most proven ways to build wealth. Thanks to technology, investing is more accessible than ever before. You can learn the basics and find investments that fit your personal investment goals. But it is also vital to make sure you only invest money that you can afford to lose.
One of the best investments you can make is stocks, as these typically offer higher returns. On average, stocks increase by around 10 percent a year. However, they require a longer time horizon, which can help you ride out market volatility. Short-term investments, on the other hand, tend to be more liquid and offer less risk.
Once you’ve decided what you want to do with your money, you can start to choose the best type of account to invest in. You can open a savings account, taxable investment account, or tax-advantaged retirement account. Each account is unique, and the type you choose depends on your goals. You can also use robo-advisors to help you make your investment decisions.
Before you invest your money, make sure you get rid of high-interest debt. Many financial planners recommend that you create an emergency fund large enough to cover six months of expenses. This is an excellent target amount to aim for.
