How to invest money to make more money? Investing guide for beginners

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How to invest money to make more money? Investing guide for beginners

Are you a beginner at investing? And interested in knowing how to make your money grow? This article is for you,

In this article, you will discover the best way to invest your money in the best way to make it grow

Investing refers to putting part of your earnings into something that will generate positive returns in the future; it is a way of making money grow.

Without investing, your money loses value and the only way to stop your savings from losing value is through investing in assets that will generate positive returns in the future

Saving without investing makes your money lose value because of inflation

The best way to invest money to make more money is to invest in assets that will generate more money in the future, the best assets to invest in include real estate such as rental property, single family homes, duplex, condo, commercial real estate, stocks, index funds, yourself, your business,

So in this article, you will get answers to the following questions

  • What are the 4 types of investment?
  • Where do I invest my money?
  • What is a good investment to make money?
  • Where do I invest my money to make more money?
  • What is a good way to invest?
  • How can I invest with no money?
  • How to invest in real estate for beginners?
  • How to invest in rental property?
  • How to invest in index funds for beginners?
  • Types of assets to invest in
  • How to invest and make money daily?
  • How to invest money wisely?
  • How to invest money in stocks?
  • How to invest money in stocks for beginners?
  • How to invest money in real estate?
  • How to invest money in UK?

How to invest in stocks for beginners

Deciding to invest is one of the best decisions you can ever take in your life and investing in stocks will offer you an opportunity to make your money create more for you while you’re sleeping

Do you need to discover the secret to making a lot of money through stock investing? If yes this article is for you

What is stock investing?

Stock investing refers to purchasing a share in a company to receive dividends, when you buy a share you own a certain proportion in that company

It is a way of becoming part of the owners of the company and you’re entitled to receive dividends

What are dividends?

Dividends are the profits that are made from shares that are sold by a company

Why invest in stocks?

Stock investing offers you an opportunity to make you money create more money for you; this is through earning dividends or your stock appreciating in value

Why should you not keep your money in cash?

Money losses value over time, it is affected by inflation due to the general increase in the price level of goods and services

So a dollar today is not equivalent to a dollar next year

By just saving money without investing it, your money losses value

This is the main reason why investing is very important

So what can you do to prevent your money from losing value?

Invest invest invest 1000 times

Where should you invest your money?

These are the 4 best investments:

  • Stocks
  • Real estate
  • Yourself
  • Business
  • Index funds etc

But in this article, we are only concentrating on stock investing

You should invest your money into something that will generate profits in the future; the return of investment should be high but with less risk of losing your money

Stock investing offers you this opportunity, you will receive up to 3% dividend from the money you invest in stocks, this is higher compared to the amount of interest you will earn by saving money in your bank account

Most banks will pay you less than 1% interest and the inflation lever is up to 2.5%

This means that by keeping your money in the bank, it loses value by 1.5% which is a lot

So stop keeping your money in the bank account, instead invest your money in stocks

Stocks are assets that are guarantee to bring positive returns in the future; this is why stock investing is my long term choice

Why should you not save money in a bank account?

How do you stop your money from losing value?

Investing is the best way to stop your money from losing value but you need to know that every investment involves taking the risk

And stock investing is not that different; you can either make money or lose money

All you need is to invest in assets or investments you know and trust, invest in companies that have consistently paid their shareholders

How do you make money from stock investing?

By investing in stocks, you will receive up to 3% dividends each year, assuming you invest $1,000 today in 2021, if you don’t withdraw your dividends you will receive

Amount= 1000(1+003)^10

            =$1,343.9

In 10 years, your stock will have generated $343.9 in dividends

This is the power of compound interest; your money will accumulate over time

Besides earning $343.9 in dividends, your stock will have appreciated in value, it will be worth more than the amount you bought it

Comparing saving money in your bank account to investing in stocks, which is better?

Most banks will give you less than 1% interest, while in stocks you can earn up to 3% interest

So comparing the two, if your risk-averse saving money in the bank account is for you, but the interest you will earn is very little because your money gets affected by inflation

If you’re a risk-taker and interested in investing for a long time, stock investing is for you, you will earn money in form of dividends and stock appreciation

How do you buy a share? How do you start investing in stocks? Where do you buy shares?

Stocks are not bought directly from companies but there are stockbrokers which help connect companies and individual interested in buying a stock

All you have to do is to open an account with these online brokers and start investing

The best online brokers to help you start investing in stocks are robinhoodwebull, and public

You can also invest index funds using a platform called vanguard

So before starting to invest you need to invest in companies which you believe that they will perform well in the future, those companies should have paid their shareholders consistently over 10 years

You need to look at their financial statements to analyze their past performance

How do you choose which stocks to buy or invest in?

You can choose to invest in individual stocks or index funds, individual stocks are very risky compared to index funds

So before investing you need to first know your risk tolerance and the time you want to invest in

For example if your risk-averse invest in index funds because your money is invested in several companies and if one of the companies performs poorly, gains will other stocks will compensate the losses

Stock investing is best for individuals who are investing for a long time; it is not for people interested in investing today and cashing out your money tomorrow

So be prepared to keep your money in the stock without selling it for a long time, this is when you will make the best profits

What are index funds?

Index funds is where you invest your money in stocks of several companies like the S&P 500

This is done using a platform called vanguard

Why index funds?

Investing in index funds is easy and there are many companies to choose from like the S&P 500,

Index funds offer you an opportunity to reduce the risk that comes in stock investing by diversifying your portfolio

Is investing in index fund risky?

All investment require taking a risk, you can either lose money or gain money, this will depend on many factors that are prevailing in the long run,

The stock prices keep fluctuating from time t time, you need to be prepared to invest for a long time, if you want to cash in your money next week, don’t invest in stocks

Invest in stocks for over 5 years

During a recession, the stock prices will go down; this is the best time to buy stocks because most people fear to lose money, so they begin to sell

You just need to know that a recession is a temporally situation which so often happens in the trade cycle

When prices are high, this is not the best price to buy stocks; it is the best time to sell

You need to buy stocks when prices are low and sell when prices are high for a profit

How much money do you need to invest in stocks?

You can invest any money you can starting at $1 but the large amounts you invest, the more benefits/ dividends you will enjoy

The best platforms to start investing in stocks include robinhood, webull and vanguard

How does the stock market work?

What is a stock?

A stock is a financial instrument that signifies ownership of a company in a given proportion, ownership of a stock means you own a certain proportion of that company, if the value of the company increases, your stock value will also increase

Why do companies sell stocks?

Selling stocks enables companies to raise large amounts of capital to grow and expand their business

How do companies list shares?

Companies list shares through Initial Public Offering and the company moves from being privately owned to publicly owned

Once company shares are listed, individuals or companies can start buying them

Stocks are traded in the stock market, and the stock prices of a share depends on its demand and supply of that stock

Why do stock prices keep fluctuating?

There are many factors that make stock prices to fluctuate, this depends on the demand and supply of the stock, it can also depend on external factors like political environment

If many people are buying a stock at the same time, the price will increase while if few people are buying, the stock prices will go down

Where do they sell or buy stocks?

Stocks are bought in the stock market; there are online brokers that help connect individuals and companies selling stocks

The best brokers include robinhood, webull and public.

Why invest in stocks?

Stock investing offers you good value for your money, you money will create creating more money passively through dividends

Most stocks offer a dividend of up to 3% which is not so common with banks

How do you get started with stock investing?

Join an online broker by opening up an account with them

The best online brokers we recommend are Robinhoodwebull and public

Conclusion

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Real estate investing: How to invest in real estate for beginners?

Is real estate worth your investment? In this post we will look at how you can invest in real estate which is a booming and profitable industry.

Why do we invest? We invest so as to obtain enough and consistent returns no matter the general conditions in the market, profits go to individuals who analyses and interprets the existing information

To succeed in this industry you must first invest in your personal development and develop a network of individuals who have interest within the real estate industry to share knowledge and advice.

You identify an undervalued property, renovate it and sell at a double price,

Personal development helps you to make informed decision arising from the growth of the skills you have attained; you get to understand the best timing to purchase property.

In real estate investing financial literacy is very important, you need to know how to invest, property development, renovation, buy and sell and costs involved. It is not what you do that determines your real estate investing success but how you do it.

Most real estate investors understand good loan is instrument in development your real estate portfolio, they use debts and purchase real estate at a low price and sell at a high price to make profits, you can use credit wisely to acquire real estate property.

You don’t need to be an expert in real estate investing; you just need to surround yourself with a team of knowledgeable experts to be successful. These people may be property value, manager, accountant, realtors and real estate mentors.

For you to be successful with these people you must be willing to learn how to work with a team of experts, manage and also make final optimistic decision.

It’s advisable to work with individuals who are themselves wealth, investors in real estate and also knowledgeable in your field, this eases your work and you obtain the best decisions to make.

Steps to successful investing.

To be a successful investors there are five steps you need to follow and they include:

  1. Make investing a habit,

this helps you to learn the in and out of your investment, you develop the skills necessary to make final decisions on your own without relying on financial advisors, this reduces on the costs involved in using brokers.

Once you develop this habit, you will start adding to your investment portfolio real estate property to purchase or sell. Remember whenever you purchase a property, property value goes on increasing as a result of compound interest rates

Compound interest is where the value of the earned interest from your property increases as a result of increase in the interest rate, in other words interest producing more interest.

This is what happens in real estate investing, the property value keeps on appreciating from time to time. You can purchase a house at a low price, renovate and sell it at a double price, this is the power of real estate.

  • Set realistic goals of what you want to achieve within a given time,

this helps you to keep on track your main goal and objective in investing, you can have a goal of financial freedom by age 40 years.

You can also short term goals for example going for vacation every year and then you work smart to achieve it.

Your goals should be SMART, meaning Specific, Measurable, Achievable, Realistic, and Time-bound.

  • Take necessary risks,

you all know that in investment there is a risk and that risk is being compensated by the return you get, when your taking risks you need to have the endpoint in mind, invest where you are guaranteed of getting back your money, you ask yourself is what am investing in viable? Will I obtain returns? What is the payback period? What is the opportunity cost of not investing in another investment?

Once you get solutions to those question you are bow free to make your decision.

To reduce on the risk involved,you can build a solid foundation of security like insurance cover or having a savings account.

Remember high risk results into higher returns, that’s why people who are good at investing are risk takers but they risk where they know that they will get returns, not just speculating the market.

Fear of risks results to financial struggles because all investment involves risk for example there are risks in bonds, stocks, real estate and mining.

  • Diversify your investment portfolio,

 as the saying goes that don’t put all your eggs in one basket, you can have a variety of investments you can invest your money expecting that after some time they will yield profits. This helps you in case of a loss in one investment, it will be compensated by a big gain in another.

The investor’s mind

Good business+ good price= great return.

Skills of good investors

  • Emotional discipline, you act in a set of predetermined rules
  • Decision making
  • Critical thinking
  • Self-motivated

Question to ask before investing in any company.

  1. Is the company registered?
  2. Is the company worth it?
  3. What skills do workers exhibit?
  4. How has the company been performing previously?
  5. What is the trend profits the company is on?
  6. How much earnings will I obtain?

Summary of terms used in investing.

  1. Compound interest, interest resulting from interest producing more interest
  2. Bonds, interest bearing that obligates the issuer to pay a specified amount of interest after a given time.
  3. Diversification, having different investment
  4. Capital gains, difference between the buying price of a property and selling price.
  5. Mutual funds, a portfolio of stocks, bonds or other investments divided up by shares.
  6. Portfolio, collection of investment
  7. Opportunity cost, next alternative foregone when choice is made.
  8. Stock, share in a company

Thanks for reading, today’s question is,

How would you like to invest your money? Real estate, bonds or mutual funds and why?

Investing in a rental property for beginners: How to invest in rental property?

What is a rental property?

A rental property is a home that is purchased by an investor and inhibited by tenants on a lease or other types of agreement, it Is best for individuals or households e.g. stand-alone, single-family homes, apartments, duplex, etc

When should you start to purchase a rental property? What to look at

  • Do you have debts?

You should start investing if you know that you are debt-free, if the return on a rental property is greater than the interest you paying on your debt, invest in rental property

But

If you have credit card debts with higher interest, don’t buy a rental property because the return you will get is less than the interest on debts

  • Do you have a down payment?

The down payment is that money you will pay for a rental property in cash

You need to know how much money you need to pay before getting a loan from the bank

Ensure that you have a down payment of over 20%, this is where banks will be willing to offer you a loan

Don’t borrow money for a down payment; if you do this, there are higher chances for you to even lose your mortgage

Banks don’t want to invest money into a property where the investor has less money, they fear making losses

  • What is the interest rate on your mortgage?

Some banks or money lenders charge higher interest rates; you need to know how much interest they are going to charge

Shop around and find a financial institution that will offer you money at an affordable interest

  • What is your return on investment?

By investing in rental property, you need to ask yourself how much money will you get in return, what will be your cash flow, what expenses are you likely to incur, how long will it take for you to pay off the mortgage? What percentage return will get

Real estate investing for beginners

Basic real estate terms

  • Single family home

A home for a single family to live in

  • Duplex

A home with two separate doors for people to rent

  • Condo

A home with other different homes connected together

  • Mortgage

The difference between the price of a property and down payment, it is an amount you borrow to supplement your down payment

  • Cash flow

Cash flow is the amount that you earn from owning a home

How to build wealth with passive income? Best ways to get assets to buy liabilities

Are you looking for the best ways to build wealth passively? If yes this article is for you, in this article, you will learn how to use assets to buy liabilities

“if you cannot find a way of making money while you sleep, you will work until you die”

This simple strategy will help you build wealth in the most effective way

So

How to build wealth using the OPM strategy?

The OPM strategy refers to using Other People’s Money to build wealth

How does the OPM strategy mean?

Assuming you want to get a residential house, a residential house is a liability because it takes away money from you,

Assuming that this house costs $50,000 and you have $50,000 in your saving account

So what should you do? Should you use $50,000 to purchase a residential home and remain with zero or invest it into asset that will generate more revenue?

The best thing to do is to buy assets to generate cash flow that you will use to purchase liabilities

The best assets to invest in include stocks, real estate, mutual funds etc

By investing $50,000, this will make you earn money while you sleep,

So

Once the cash flow from your investment starts coming in from the assets, you can use the profits to buy liabilities

This is how the OPM strategy works

You will be earning money passively by leveraging other people to use your money to produce more money for you.

Once the amount of cash flow accumulates and you reach the amount of money to purchase a residential home, you can buy it,

How to invest money for beginners FAQ?

These are the commonly asked questions about investing

  1. What are the 4 types of investment?

The best 4 types of investing are real estate, stocks, business, and yourself

  • Where do I invest my money?

The best way to invest your money is to invest in assets that will generate positive returns in the future

The best assets to invest in include real estate such as rental property, single family homes, duplex, apartments, business/ commercial real estate, stocks, index funds, business, yourself.

  • What is a good investment to make money?

A good investment is anything where you put your money in and it generates more money to you

Good investments include investing in stocks, real estate, business, yourself,

  • Where do I invest my money to make more money?

The best way to invest your money is to invest in assets that generate profits, examples of these assets include rental property, stocks, index funds, business and yourself in form of improving on your skills

  • What is a good way to invest?

A good way to invest is to invest in assets, you need to know the difference between assets and liabilities, and Assets bring money into your pocket while liabilities take away money from your pocket

Examples of assets include rental property, index funds, stocks, land, business, etc

  • How can I invest with no money?
  • How to invest in real estate for beginners?
  • How to invest in rental property?
  • How to invest in index funds for beginners?
  • Types of assets to invest in
  • How to invest and make money daily?
  • How to invest money wisely?
  • How to invest money in stocks?
  • How to invest money in stocks for beginners?
  • How to invest money in real estate?
  • How to invest money in UK?

This marks the end of How to invest money to make more money? Investing guide for beginners

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