Moneywise

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There was a time when money matters were only handled by the man of the house. But now things have changed. Today’s women are equally involved in a family’s savings and investments.

Saving for a rainy day is very important in life and a must for all.

But then savings if kept in a bank make you lose money as the rate of inflation is always more than the bank interest, and in a few years’ time inflation would eventually eat up your savings.

The solution lies in making the right investments to multiply your money.

Savings sleep while you work and investments work while you sleep.

One should be careful while making investments as fly by night conmen are waiting to take advantage of naïve investors with the promise of doubling their money overnight.

The trick is to invest with companies who make an honest profit and share it with you.

This form of investment is called shares. One could also invest in gold and real estate. Investment in shares is better than real estate as shares can be sold easily when the need arises whereas property is not easy to sell.

Ideally I would suggest, 30 per cent savings in shares , 30 per cent in property, 30 per cent in bank fixed deposits, and 10 per cent in savings.

Shares have earned a bad reputation due to speculation. People who speculate in the stock exchange may lose a lot of money and may end up getting sucked into a vortex as they speculate more in order to recover what they have lost, eventually losing more money in the bargain.

The sensible thing to do is to invest in blue chip companies who are doing well. You could do a bit of a research yourself or take the advice of a good consultant..

The most important thing in shares is the timing. One has to buy when the shares are low, and sell when they are high. When shares are low, it is called the bear phase and when they are high it is called the bull phase.

When there is euphoria or frenzy of buying of shares, it is the starting of bear phase, ideal time to sell your shares, and when there is feeling of total loss, is the starting of bull phase, ideal time to buy shares, the above is easier said than done, greed is what leads to heavy losses.

The other important thing is to invest for a minimum period of five years. Do not expect to become rich overnight.  Remember shares are not a means of doubling your money overnight, but investing with enterprising people who make good a profit and share it with you.

A little bit of effort from your side will bring you rich dividends.

So, here’s to HAPPY INVESTING!

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