Ask someone about the best way to invest money, and chances are you’ll get an enthusiastic answer. Because everyone seems to have an opinion on this issue.
And that’s the key word when it comes to trying to answer that question for yourself – opinion. Because that’s all it is. There are statistics and war stories out there that can support or decimate virtually any opinion about how best to invest your money.
At the end of the day, only you can answer that question.
So Many Options, So Many Outcomes
One option for your money is to do nothing with it. Stuff it into a coffee can and hide it under your mattress. Not only will you sleep poorly, your money will gradually decrease in buying power because of a little thing called inflation.
So if you think doing nothing is riskless, think again.
You could open a bank savings account. Your money will be safe, but the return on your investment – the amount of interest the bank will pay you while they use your money to loan to others for a higher return than they’re paying you for the privilege – may not even keep up with the rate of inflation you’re trying to stay ahead of.
You could always buy real estate, but when you do you’re tying your money up in something that may not be easily liquidated (sold), meaning you may not have access to your money when you need it. And, while for years real estate was considered a safe and lucrative long term investment, don’t tell that to today’s selling homeowners, who find themselves underwater (they owe more than their house is worth).
The Stock Market – Ya Pays Yur Money, Ya Takes Yur Chances
Then there’s the stock market, with all it’s nooks, crannies, tools, programs and strategies. Within the realm of stock marketing investing there are high risk approaches and conservative approaches, and all sorts of creative strategies in between, but they all depend on one basic thing: the health and vitality of the overall economy.
In general it boils down to this: in a strong market you stand a good chance of making money, over time, with a reasonably modest amount of risk. But in a depressed market in an economy that isn’t a picture of health and hope, chances are your investment will find the going tough.
But then, timing is everything in the stock market. Because if you know what you’re doing and can tolerate the stress of high risk, down markets can make you a bundle, and strong markets can make you an even bigger bundle.
Or not. Because you see, there are so many things you need to understand, and most of them are completely out of your control.
And as for short term investing… well, all bets are off there.
So what’s the safest place for your money?
The answer comes only after you’ve taken the time to understand all the available options, and weighed them against your specific needs, risk tolerance and liquidity requirements.
Until then, think about that bank account.
FREE – How To Make Money With Options
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