Saver or Investor which one are you?
Most people are able to save money. It is just a matter of spending less than you earn but few people are investors. If you have say a grand or two in an ordinary on call savings account then you are not making the most of your savings. An ordinary savings account will only pay around 1-2% interest which is not much more than the inflation rate. On top of that, you have taxation to pay on the interest. In the end, it is no way to grow your savings. The bank is really using you and your money to get rich. They charge their borrowers a much higher interest rate than they are paying for the use of your money and to rub salt in the wounds, the bank’s best customers, those who borrow money for their businesses recoup the money they paid for the use of your money by charging you a higher price for the goods and services they provide.
There are plenty of options for investing your money and no excuse for burying your head in the sand. The banks do have fixed term options at higher rates for those who have a lot of savings. The minimum investment for these is usually around 5k upwards.
Managed Funds are a good option for those who want to grow their savings at a faster rate. It is a good way of investing indirectly into the sharemarket. your investment is combined with all the other investors who have joined the scheme and the fund invests in the markets. You do have the option of which fund to invest your money such as conservative, balanced, or growth.
It pays to do your homework irrespective of where you invest your money. I think the factor which determines the risk level you are prepared to accept is how soon is it that you need your money. If you are saving for a house deposit then you certainly would not be investing your money in high risk investmennts because when it comes to using your money, the markets may have taken a dip, otherwise known as a “Bear Market.”
It is all a matter of increasing your knowledge. I have an ebook “The Golden Rules of Wealth.” which can help change the way you think about wealth. It is only $5. Check it out now.
www.robertastewart.com