A-The concept of investment
Investing is one of the best ways to build wealth and financial independence. The concept of investment generally is to take money (capital) and try to develop it by buying assets that you expect will increase over time. There are many types of investment and diversified according to the objective, means, return and risk.
The goal of investment is to achieve financial freedom. The sooner you start investing, the more your investments will increase and the returns will start to increase, so that your salary or your monthly income will rise, and you will start to concentrate on managing these assets.
B-Qualifying the average individual to become an investor
Most people spend most of their lives working for pay, and forget that by saving and investing in a portion of their income they will increase their ability to meet their future expenses, such as buying a home, saving the cost of educating children, providing enough to meet the demands of life, The standard of living that one habitually enjoys after retirement and ceasing to work
The vast majority learn how to master a certain skill for working for money, but in return they do not learn how to make money work for them too. The following are steps that will qualify the average person to become an investor:
1-Investment is the branch .. Saving is the origin
Saving is the gateway to investment and wealth. Investment is the branch .. Saving is the origin, so you have to save first to be able to enter the world of financial freedom. "Save what is left after the exchange, but spend the rest after saving," this famous advice Laurent Buffett summarizes a lot about saving.
For those with high incomes, try to save between 15% and 20% of your income so that you can achieve the rule of doubling ownership every 5 years, which is one of the most important rules of financial intelligence and investment, where doubling your property every 5 years, which is an important investment goal.
For those with intermediate incomes, it is preferred to be 10%. Those with low incomes prefer to find additional sources of income or evening work so that they can save and improve the current living conditions. Saving here is between 5-10% of the monthly income.
2-Make a list of investment objectives and requirements
The first step to planning your financial goals is to organize them according to specific time frames, ie short-, medium- and long-term goals. Whether you want to buy a car, invest in real estate / gold or save for marriage, whatever your financial goals, you can start to achieve it by clearly identifying and categorizing them within specific time frames.
You must know what are the terms and requirements of any investment before proceeding. For example, retirement investment, emergency or insurance, or the benefits of tax savings. If you know exactly what you're looking for, you'll get a clear picture of how much you should invest and where you should invest.
3-Save an amount for emergency
If you do not have an account of this kind, it is a good idea to focus your efforts on providing a living cost of 3 to 6 months in a so-called emergency fund. The funds of this account are very important and must be available at any time, savings that you do not invest.
Do not use all of your extra income in investment operations, as long as you do not have a physical cover in case of any emergency; it may happen that the table turns on you and lose your job God forbid or investment markets are vulnerable to a violent shock or sudden illness. Failure to prepare for such possibilities is a lack of responsibility.
You should be interested in feeding this account. You can divide your excess income each month, transfer part of it to the emergency account, and the other part to your investment operations.
4-Avoid over-spending
Spending money on recreational items is common when a person is in his early twenties. In this period, when he works and earns a financial income, he has the power to spend money freely, and of course in the absence of life experiences and experiences there are consequences.
It's okay to enjoy the money you've earned with your effort, but you do not have to spend it unnecessarily or impulsively.
Merely making a decision to save a fortune and invest it in a good plan is a better decision than irrational consumer spending. Sporadic spending leads to remorse later, while a good saving decision results in a sense of psychological peace and satisfaction.
5-Do not invest without knowledge
Do not invest your money in things you do not understand at all, because not having the correct and complete information can lead to incorrect investment decisions, and therefore you will lose part or all of your head instead of making the gains you want.
If you do not know which options are best for you and your investment goals? Refer to a financial advisor who guides you to best investment practices. He knows market trends, investment strategies.
The advisor will help you know the best investment plans that are appropriate for your requirements, and how to diversify your investment options as well.
6-Invest at least 15% of your income.
Plan to invest about 15% of your income, this money will accumulate over the years and give you a huge return on investment.
The best you can do is apply an automatic deduction from your salary that is automatically directed to your investment plans or to a separate savings account to build capital that you can invest later.
If you do not make this process automatic and without interference from you, you will be subject to delay and procrastination. All you need is to adjust the actions required to automate things.
C-Investment Methods:
Whether the funds you want to invest are small or large, the goal is one: to make these funds grow and get additional funds. The investment methods of salary that help you grow your money vary greatly depending on the method and method of investment, the amount of money and the time frame of this investment and therefore you must invest according to your personal requirements and your ability to invest.
There are stories about people who become rich by investing in stock trading in the evening after they return from work, but they are very rare
One can actually achieve financial freedom if he follows a "good investment strategy". Here's a list of 14 ways to invest, try and choose what works best for you:
1-Invest in stocks
Investing small amounts in stocks constantly is like a snowball that you see roll over and grow in front of you over time. True, earnings are unpredictable in the near term, but they are often profitable in the long term. We are talking about long-term investment, not speculation.
Do not invest your money in just one company, but invest in several companies always, putting all your money in one company may lead to loss. Also, not only invest all your money in the stock market, but distribute your money in various investment plans.
Investing in financial markets (stocks, funds, bonds, bonds) generally suits you if your income is not high. Try to invest even a small portion of it in small investments at least initially. Although it is not possible to obtain a large return on small-scale investment in the short term, it may be profitable in the long term.
2-Invest in retirement plans
An individual can not work for the rest of his life. When he grows older, his abilities will decrease and his productivity will decrease. Thinking about retirement is very important and one must start working on his retirement plan as early as possible.
Retirement investment plans should be a top priority for your investment list, but should be ranked first and followed by other investment plans.
You should continue to analyze your retirement goals and investments, and as your salary increases over time, increase the funds you invest in your retirement plan.
3-Invest in "what is more than money"!!
The best investment is what you spend to develop yourself. This is the only investment that no one can take away from you. Recent studies confirm that what you invest in yourself must change some aspects of your life for the better.
You do not have to be an expert in everything but you have to know very well what are the limits of your circle of knowledge and what is outside and what is in the circle of your goals you must learn. You need to know well what your strengths are and what your weaknesses are, which are the most important things you should know now.
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