Millions of Americans are excellent savers but still have not found the secret to attaining wealth. That’s because saving alone isn’t a wealth-building strategy‚Äîit’s a survival strategy. To put it in other terms, the difference between saving and investing is like the difference between getting by and thriving.
Besides having a job that pays upwards of six or seven figures, the only way to build true lasting prosperity is to invest. There are several ways to get into investing. You can start a business, invest in stocks or real estate, and you can even loan money to corporations and the government. Continue reading to learn some of the ABC’s of investing.
Decide what kind of investor you are.
There are so many different types of markets and assets to invest in but the first step to becoming an investor is figuring out what kind of investor you are. Do you want to actively engage in the stock market, or would you rather take more of a passive stance? Are you more of the big risk big reward mindset, or do you believe in a more conservative, long-term approach? The answers to those questions will tell you a lot about how you should invest.
If you’re more interested in building wealth through a long-term strategy rather than chasing big licks, alternative investments may be more your speed than the stock market. Alternative investments are physical assets, unlike stocks, bonds, and foreign currency, which are, of course, financial instruments.
Alternative investments include, but are not limited to, real estate, classic cars, fine art, precious gems and metals, and anything else collectible that appreciates value with time. Of course, like with any other type of investment, there’s risk involved with alternative assets as well, but there’s a low correlation between alternative investments and the stock market. Plus, alternative investments aren’t nearly as volatile as the stock market.
The key to doing well with alternative investments is to take proper care of them and be patient until the right buyer comes along‚Äîthat’s if you even choose to sell. If you’re interested in learning more about alternative investments, you should visit yieldstreet.com to get more insight.
Financial advice isn’t free.
If you don’t know much about investing, it’s in your best interest to acquire a financial advisor or stockbroker’s services, but as you can imagine, advice on how to grow your money isn’t free. A financial advisor provides full-service financial advice ranging from different types of insurance, investments, and retirement plans to the stock market. A stockbroker advises on the stock market and processes stock transactions for clients.
Besides the type of advice they give you, another key difference is how you pay them and how much you pay them. With stockbrokers, you pay them a commission for each trade they make on your behalf. Financial investors may charge by the hour, and some even charge you a percentage of your financial portfolio. Also, since financial advisors provide a full range of services, their fees are usually higher than stockbrokers.
You have rights as an investor.
There is risk associated with any investment you make, but it’s important to do all you can to avoid being taken advantage of. If you do find yourself in a situation where you feel like a financial advisor or stockbroker has put you through the wringer, it’s comforting to know you have advocates like Malliha Wilson and others on your side.
Ever since Malliha earned her law degree from Osgoode Hall Law School, she’s been advocating for others’ rights. She hasn’t let her role as special legal advisor to the Investment Management Corporation of Ontario deter her from advocating for human rights. You want a lawyer like her going to bat for you if you catch yourself on the wrong side of a shady trade or investment.
The most important thing to learn about investing is that you’re not going to learn it all in one sitting or meeting. Take the time to educate yourself and develop a strategy that works for you and your future goals.
