Investment and finance are correlated with each other. The moment someone gets into a job, he/she has to start planning for savings. It all depends on putting plans into actions to achieve long-term goals. But, some amount of money should be kept-aside for daily expenses and medical emergencies.
The first step
The primary step to invest some money is creating an individual savings account (ISA). It is best if the account is cash ISA instead of a standard savings account. The difference between them is that in the case of the former, the client doesn’t have to pay any tax on the interest earned. But, unlike a standard savings account, there is a fixed limit for the amount of money that an individual can put every year in a cash ISA.
But the ISA and standard SA both are profitable. Moreover, after some time people become aware of the kind of investment they want to do. There is no harm in trying.
Other options for investment
- Corporate and government bonds:
Bonds are loans given to a corporate organisation or the government respectively. For this, the clients a certain amount of interest at set intervals over a specified period. After which, the principal amount of money is returned to the client. Corporate bonds usually offer a higher yield as compared to the government ones.
- Investment bonds:
These are life insurance policies where a person can deposit a lump sum amount of money in a variety of available options. But, it is a necessity for a tie-up that cash for a fixed period. The funds will be en-cashed back only after that time is over.
This phase of investment can be done once a person has stocked up on some money. Say, after working for at least four to five years. Investing in land or any other property requires long term planning. It is crucial to take advice from the legal advisors and of course family members. Because, after all, it is all for the future of the family.
- Open-ended investment companies:
Here the investment is made straight to a single company, which is later put into various funds and assets but according to the company’s wish. The client doesn’t have a say in it.
- Stock markets:
Share market or stock market is like gambling. Here, the money is directly invested in the stake of a specific company. The customer gets benefits when the company gains profit. So, if there is a massive profit in the company’s stocks that means the client will get a dividend (a share in the benefit). It has its ups and downs. But, if invested strategically then it gives a lot of profit.
Investing is essential to have a secured future. If there is any confusion regarding where to spend, then one can quickly take help from a financial adviser.
Save money, be happy.