When you make a decision to invest money, there are safe and unsafe places to place your hard earned cash. Gambling in any shape or form is exactly that a very unsafe investment to be avoided at all costs.
There are five different areas where you can invest your hard earned cash. Cash, property, bonds, shares, and alternatives to these. Making the right choice is the key to successful investing.
The first area we will look at is cash. It’s hard to be wrong with cash, unless you place it under the mattress or in a cupboard. Cash is great when the stockmarket is having a poor run, and shares are dropping in value over a period of time.
It’s important that you are not putting your money into your own personal account. Banks and Building Societies offer a number of schemes paying better rates of interest. If you are prepared to tie your money up, so you can’t quickly access it, then you will earn a far better rate of interest.
There are other alternatives which include cash unit trusts, and there are options involving cash in pension and insurance funds. Just be aware that you are not going to make your fortune in this area.
The simple fact is this. You will pay tax on any profit, so you need to have one simple aim here, and that is that your interest from the investment is on or about the annual rate of inflation. Put another way, if there is 4% inflation you will need to make more than that in interest so that after tax is taken you will have made 4%.
The question then is why pick cash investment as opposed to one of the other areas. The answer is quite simply, this is the best and safest investment when everything in the economy seems gloomy. It is secure, it is safe, and the best thing to do if you are uncertain or confused.