Investing your money makes sense. You’re able to turn a little into a lot over time with very little effort by determining the right time to invest. Unlike getting up and going to work every day for eight hours, investing tends to generate ‘passive income’ which is a concept that’s attractive to just about all of us.
However, investing isn’t something that we should throw all of our money at haphazardly, there are a few steps first that are best to be reached. Read on to find out more.
You’ve got a mortgage
In terms of financial security, one of the very best things you can do with your money is to put it into a property for yourself. A home will accumulate in value, it will mean you have somewhere secure to live after retirement and gives you something meaningful to pass down to your children.
You get to avoid expensive rents, nightmare landlords and other costs that can come about as a result of not being on the property ladder. For this reason, when you’re first starting out in your journey to financial freedom, a mortgage should be your first port of call.
Once you’ve secured your own place to live, that’s when you could consider further investments later on. Get yourself set up first, and make owning a home your first priority.
Your day to day bills and affairs are in order
There’s no point investing money and spending it elsewhere if your day to day finances aren’t in order. Make sure you have your money in order, this means being able to easily pay bills and cover any unexpected expenses when needed.
Ideally, you will have your bills automated with many months paid in advance. You can do this by opening a separate bank account that’s just for your bills, that way you can set them all to come out via direct debit.
If you put a chunk of money in that account initially and then slightly overpay each month you’ll always be ahead. If you ever need to miss a payment or two for whatever reason, you’re well and truly covered.
You have considerable savings
Finally, if you have considerable savings that are sitting around not doing much, it’s a sign that you could consider investing. This is because investments will make your money work harder than any savings account- even if it’s high interest.
Whether you’re looking into investing in Costa Rica in property or buying commodities in precious metals, oil or cryptocurrency, smart investments can be made once you already have savings. Unfortunately, there are always some risks to investing so it should never be done with the money that you need such as your nest egg or pension savings.
When do you think the right time to invest is?