Learning how to invest can be quite intimidating for first time investors and remains quite scary even for seasoned investors given our current recession. This site provides an excellent blueprint for investors looking to learn the ropes but also for investors looking for new ideas or looking to expand into new markets.
Below, you will get a quick crash course on what investments really are, how you can invest in them, and a list of different investing options. There are many different types of investments, and as a result this investment guide is broken up into multiple categories. Each category covers different types of investments, how to invest in them, and the advantages and disadvantages of each investment type.
Before we get into the specifics, it is important to have a clear definition of what investing is (because if you think it is just about money, then you are wrong!), as this starting point forms the basis for all sound investment strategies.
What is Investing?
In its most basic sense, the word invest represents the idea of expending a resource with the expectation of some sort of return. When most of us think of investing, we think of investing money with the expectation of receiving some sort of financial return over time.
However, what many new investors do not realize is that their time rather than their money is actually actual their most valuable resource. This is the most important investing “secret” and what separates those who are wealthy (both monetarily and mentally) from those who are not.
An example of investing time and money would be investing in a business, either physical or virtual (i.e. a website), or investing in property. You can invest actively invest time into your business or website or fix up the property you purchased in order to increase its value. An investor without much money to spend but a lot of time will get a much larger return-on-investment with this type of project should they be successful.
On the other hand, more established investors that already have built up a considerable sum of wealth will get “more” from their investment by investing in things designed to preserve their wealth with little effort, freeing up time (time is money, after all). This gives them the luxury of spending their time with their friends, family, and doing the things that they love.
Types of Investments
Below, you will find a list of the different types of investments. As this site grows and expands, more and more information on investing will be added, so be sure to check back regularly for more methods and tips on how to invest.
We are not going to consider investing in yourself (school, beauty, and so on) for the purposes of simplicity. For example, some might invest in an acne scar cream to improve their appearance and lighten their scars with the silicone-based product. The improvement in appearance might help you land a better job or date, resulting in more income potential. These investments are too hard to track so we will leave the acne product investing to another discussion.
Investing in Gold and Other Precious Metals
Investing in gold and other precious metals is one of the most popular forms of investment these days. Gold is the “gold standard” (pardon the pun) of precious metal investing with silver being right behind it, so the focus of this section will be on buying gold and silver. Investing in other types of precious metals unless you have intimate knowledge of the industry, simply because these markets are more volatile.
Precious metals tend to become very valuable in recessions and when fear of inflation is high. As a result, precious metals have rapidly increased in value over the last several years thanks to recent global recession.
Learn more about gold in our section on investing in gold. For information on other precious metals, see our section on how to invest in gold.
Investing in Stock – How to Invest
Stocks are definitely one of the most popular investments around, especially for younger individuals or those with a lot of money to invest. The stock market allows you to invest in different companies, currencies, and commodities, allowing you to essentially purchase a small piece of public companies and corporations.
There are many different types of stocks and there are also multiple ways to buy stock. As such, you will need to head over to our section on how to invest in the stock market for more details.
Investing in Property
Another popular way to invest money is by purchasing property. However, these investments can be very risky, as seen with by the mortgage crisis in the USA in 2006-2008. Property values tend to increase dramatically with a booming economy and fall just as rapidly in a sluggish economy.
Property value is very highly dependent upon both mortgage rates and supply. Learn more about how to invest by buying property in our section on How to Invest in Real Estate.
Investing in a Business
Investing in businesses is perhaps the least-understood but both most exciting (in my opinion!) and lucrative venture for any investor. Businesses are the one investment that is truly in your control and you can make them succeed through your own work regardless of the current economic climate.
With the advent of the internet, investing in a business has never been easier. It is as simple as either purchasing a site that is already making money, buying one you want to fix up, or starting one from scratch.
Learn more in our section on investing in websites.
Of course, investors with more money may want to purchase physical businesses or invest in start-ups (also known as venture capitalism). Typically the later requires much more starting funds, and as a result is inaccessible for most investors.
Investing in a physical business is extremely risky and would never recommend for anyone to invest their “life savings” so to speak in a physical business. This is something to invest in once you already have a nest-egg in safer, more reliable investments.
How to Invest Conclusion
As this site grows and develops, I will be adding more and more content, covering more investment ideas, strategies, and tips on how to invest effectively. By applying your new-found knowledge, you can invest with confidence and finally start putting your money to work for you!