What is Money? and How to invest money wisely?

The best way to invest money is through diversification. Never invest all your money in a single asset instead diversify it into different assets. Money is the most important thing in your life so you have to understand how to invest it wisely.

There is a saying in the market that never put all your eggs in the same basket.

First, understand the concept of money before investing it. You have to understand the true meaning of money.

Suggested Read: What are compounding interest investments?

What is money?

Money is the medium of exchange that is accepted worldwide. It is not everything but the basic need in today’s world to survive. It plays a very important role in our life and it adds value to people who have it.

To get rich quickly I believe that if you spend less, earn more than your needs, and invest your savings wisely. Then according to me, you are a rich guy who independently makes money and who knows your investment makes you super rich in the near future.

Now the real question comes about how to invest money wisely.

So now I share some ways to invest money. Before moving further understand that there is always a risk in any type of investment, so try to understand it or used to it.

Invest Money Wisely
Invest Money Wisely (Photo by Mathieu Stern on Unsplash )

What is an Investment?

According to me, If we put something into a commodity to get a better future return from it or invest money into assets to get better profit out of it.

Ways to Invest Money

There are several ways to invest money but I share only a few of them. In this modern world, there are a lot of assets where you can invest to generate high returns and there is always a risk factor in many of them.

Here are the five assets or investment options where you can invest and generate a good return in the long run.

1. Mutual Funds

Mutual Funds are in trend now days there are various types of funds like debt funds, Equity Funds, and Index Funds. I personally prefer index funds as it grows with respect to the Nifty 50 or Sensex.

2. Property or Real Estate

Real estate is the sector in which most people invest. You have to observe where new plots are colonized and have the potential to grow demand in the future.

Second, you also can develop a property or make houses and sell them to generate good returns.

3. Stock Market

The Stock Market is also a good option to invest but you have to get great knowledge of it to invest in it. Otherwise, you lose your hard-earned money. Most people call it gambling and it is true to a certain extent. If you do not have knowledge then it is gambling for you.

You have to see it as you are investing in a business and becoming a part owner of it. It can give you a high return or high loss.

To buy shares in the stock market you need a brokerage and a Demat account. I personally prefer to use Zerodha.

4. Fixed Deposit

Fixed Deposit is a widely used option because it gives you a fixed return. Mostly it is done in banks, post offices, and financing institutions. Generally, post offices provide a high rate of interest on fixed deposits.

It is called fixed deposits because you have to deposit your money for a fixed time to get a required return.

5. Gold

Gold is also very popular among people and a good option to invest your money. Its value generally rises over time. you can compare the gold price today with the price of gold 10 years back.

There are many ways of investing in gold and out many ways I explained two below.

One is by buying it directly from jewelers and another is in the form of paper gold through gold ETFs.

You can invest in all assets and follow the 60-30-10 rule. Investing 60% of the money is the safest asset, 30% in less safe assets, and 10% in riskier assets.

That’s it for you I hope you get good returns on your investments.

Note: This information is totally based on my opinion, you may differ with it, and I am not responsible for any loss.

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