There are various best ways to invest money, one of them is investment which is an alternative method of saving money while at the same time being able to gain profits for future needs. Knowing how to invest properly will make your money grow more. Talking about the amount of money, investing doesn’t always require a lot of money to invest at first. There are several types of investments that can be started with IDR 10,000. The security is also guaranteed, so you don’t need to be afraid of losing your money as long as the investment you choose is official and certified.
Benefits of Knowing the Best Ways to Invest Money
The high price of housing and the many needs in the future require you to be smart in managing your finances. Apart from saving, investing is also worth a glance. You can get big profits from investing. As long as you invest the right money. You need to remember, best ways to invest money is a way of managing finances that can give you a lot of profit in a short period of time. Investment is not a way to get rich instantly. You need a process to go through it in order to get the result. So, your money is well managed and you don’t choose the wrong investment, follow the right and safe method of investing money for your future:
- Determine the purpose of investing money
Before choosing the type of investment, you must first determine your goals in managing finances. To determine this goal, you can separate it based on the time period, namely short term, medium term, or long term. This short term has a target in less than 3 years to be achieved. The medium term is around 3-5 years. Long term is above 5 years.
Some examples of short-term financial goals are funds for year-end holidays, funds for going home, the cost of buying a vehicle, to funds for a down payment for the first house. Medium-term financial goals can be in the form of costs to continue education, funds to start entrepreneurship. These long-term financial goals include pension funds, health funds, and children’s education costs. However, the examples above can also be adapted to your individual needs.
- Learn the risks of how to invest money
After determining your goals, don’t hesitate to dig up information from various reliable sources. From this wealth of information, you will gain knowledge about the risks and benefits of investing. By knowing these risks and benefits, you can optimize the profits you want to get and avoid losses. Each type of investment has its own risks and benefits. Stock investment has the benefit of a large profit from dividends. However, the risk of investing in stocks is also quite large if the company you choose turns out to be in trouble.
Another risk is the long timeframe for profits. For that, if you want to choose a stock investment, then this is intended for your long-term goals. Conventional saving at a bank is also a form of investment. The risk of saving in this bank is quite small. However, the profit earned is also small, only referring to the addition of interest.
- Determine the type of investment
From the goals and benefits that you have set, now is the time for you to choose the appropriate type of the best ways to invest money. Once again, the choice of this type of investment is adjusted to your investment goals and the ability of the funds you can invest If your financial goal is to set up a marriage fund in the next 3 years, the right investment choice is an instrument with a low-medium risk level. You can choose money market mutual funds, fixed income mutual funds, conventional savings, time deposits, or gold.
At least this is the order of investment from the lowest risk and can be started with affordable funds, namely savings, deposits, mutual funds, gold, stocks, to property. For conservative investors, they generally like stable investments and the money invested doesn’t decrease. There are also moderate investors, namely investors who can still accept price fluctuations, hope that their initial capital will not run out at all, and are quite satisfied. Aggressive investors will be comfortable with sharp price fluctuations because they want their investment to grow many times above the deposit rate (risk free rate). So, which investor are you? This is also useful for finding the right type of the best ways to invest money, you know.
- Open and start investing
If you have set goals, understood the risks and benefits, and found a suitable type of best ways to invest money, it’s time for you to open an account and start investing. Whether investing in a bank or in the capital market, you must first open an account as a place to place your funds. For those of you who want to invest in the capital market, opening an account can be done through the right financial institution such as a securities company. Meanwhile, for mutual fund investments, you can go to an investment manager company. Now opening an account, whether for saving at a bank or playing in the capital market, is easier because it can be done online. All you have to do is prepare your personal identity card, NPWP, and other required document requirements.