“It’s not your salary that makes you rich, but it’s your spending habit and investment that do so.”
The above quote amply justifies the need to follow proper saving habits and follow up it with astute investment strategies to stay wealthy and rich irrespective of the global investment climate. From the last half a decade the world is constantly witnessing recession, hence it has now become utmost important to manage one’s income properly.
The year 2015 has been one of the calmest years for investors in recent times. Amid various speculations and rumors the year has now come to an end (of course with 2 months remaining), with stock markets following bullish trend and overall improvement in investment scenario; the year 2016 has much more to offer;
1) Federal Reserve: You have to keep a close watch on Federal Reserve Hike expected to be announced any time next year. You shouldn’t invest in bonds if the rate is hiked by Federal Reserve.
2) Long Term Plans: It is often said that investment is a long term goal. But investors often buy out from a stock once they see that the share price of stock goes down. It is not strategically right. You should not get swayed away by temporary fluctuations in stock market.
3) Diversify Your Investment: There is a famous dictum that a prudent investor should never lay his all eggs in the same market. It is necessary to diversify your investment in several schemes and stocks as much as possible.
4) Invest in Mutual Fund: Most of us want to earn high rate of interest and dividend without bearing the risk of loss. But it’s almost impossible to imagine a lot of dividend without an element of risk. For cautious investors investment in Mutual Fund is the key. As an experienced fund manager manages your fund and allocate the portfolios as per the market trends.
5) Focus on Internal Trade: With rise in the value of US Dollar People should focus on internal trade rather than the overseas markets. Exports might suffer as underdeveloped nations will curtail their imports due to strengthening in US dollar vis-à-vis their own currencies.
6) Invest in Rising Economies: Investors have lots of opportunities to gain by investing in emerging markets. You can invest in mutual fund that focuses on investing in big rising economies such as India, Russia, china and Brazil.
7) Capital Loss: It is amply suggested to keep a tab on your capital gains and losses. You can use the amount of such losses strategically by booking tax losses and offsetting your future capital when you sell your investment at a gain.
8) IRA: Individual Retirement Account (IRA) is also a good option for the investors who wish to do their retirement plans in advance. It provides certain tax advantages that allure people to invest in such schemes.
9) Invest at Early Age: Long term investment is the best investment strategy hence you should straightaway jump into investing the spared money once you cross the age of 18 or have started earning money. Learn to be patient and be ability not to get scared with initial investment hiccups.
10) Invest in Banks: One of the oldest forms of investment, it is always a good option to invest in the schemes launched by banks from time to time for its saving deposit and cumulative deposit scheme. They pay lesser rate of interest but your investment remains safe and liquid at the same time.