There are many ways to double your money. In this modern age, investing is the most powerful way that many people are looking for. But we all certainly know that not only by investing we will definitely get extra money, right? Because if we risk our money to grow, of course there are risks as well.
However, you do not have to worry. If you learn and get started the right way, you will succeed to be a good investor. The path you need to take is as follows.
1. Start From Now
Do not wait for the already established new invest, but invest in order to become established. For that, do investment as early as possible. If you are old, do it now. However, you also need to determine your intentions and goals in investing. It’s good investment is done in the long term with the aim that you can be financially free when you are elderly.
2. Exceed Inflation
If you ignore inflation in choosing a long-term investment vehicle, your investment may shrink its purchasing power. According to a report from Bank Indonesia, in August 2013, Indonesia experienced inflation of 8.79% and in July 2013 8.61%. That is, if you invest money in a State-Owned Bank Deposit that gives 5.46% interest for 1 year, or even in a non-foreign exchange private bank (renowned for high interest rate reputation) 7.21% for 1 year, you are actually losing money.
For the majority of people, stock investing or mutual funds is one way to keep up with inflation. You need to keep in mind that stock values can go up and down at any time. That’s because most investment stocks are at risk. However, stocks provide the greatest profit potential and have consistently surpassed inflation since the 1940s.
Diversification is to divide the capital you own into multiple assets. A common example is diversification in gold, stocks, property, and debt. Why is this step necessary? The goal is to prevent a total failure if one asset loses, because there are other assets that have profits. The burden felt when you lose is reduced.
4. Choosing the Right Investment
There are different types of investments that can be found in the stock market. Shares, bonds, deposits, and more. Well, choose the type of investment that suits your purpose and your ability financially. Each type has its own advantages and advantages, and of course with different risk ranges. The order of the type whose risks and the highest returns are stocks, mutual funds, bonds, and the last deposit. To invest in stocks, strengthen your mentality and learn more about the ins and outs of investing stocks comprehensively in order to know the risks.
5. Start with Small Investment
Start investing with capital little by little, to grow your confidence. Choose a guaranteed investment that has performed well over the last five to ten years. You can further consult your broker. For reference, read more books on stock play tips for beginners or keep up with stocks on the internet.
6. No Need To Monitor Too
For tips this one may sound strange. Do not monitor too often? Why? Because it is too often to monitor the development of investment, it can actually make you worry and afraid to make decisions. Basically, the main purpose of investing is to build wealth for a long period of time. So what happens to your day-to-day investment performance is less relevant. So monitor your investment every month for example.