A new year is around the corner, once Christmas is out of the way it’s always How can you make your hard-earned money work hard for you? If you are thinking about investing, here are four options worth considering:
Investing in the stock market – Although not without risk, as shares can go down as well as up, this type of investment is traditionally a strong long-term option. A good return in the short-term is rare, but if you are patient and you are in it for the long run, investing in the stock market after the Global Financial Crisis might prove financially rewarding. You can invest in a single company, or to spread the risk, you could consider investing in a fund. This long term option generally performs better than government and corporate bonds
High Interest Savings Account – This is a safer option, if you are happy that your chosen bank or building society is safe. The recent economic instability and tough banking regulation has seen us lose faith in some of the big names in banking from overseas. However, the Australian Federal Government is considering a similar scheme to what the British call an ISA (Independent Savings Account). The theory is you can store a certain amount as tax free savings while accumulating interest.
Invest in property – This is a more complicated way to invest your money. You can invest directly (you buy all or part of the property) or indirectly (you get a share of the profits by buying into a property fund or company). You will need to do some research to minimise tax in order to get the best out of your investment. You can also let out the property for a steady income, or sell it on for a profit. You may also have to factor in maintenance and insurance costs.
Invest in a local business – If you a serious about making your money work for you by investing in a local business, you will need to do more research. Investing in start-ups is always risky, unless you are persuaded by a strong business plan. You may also have been approached by a friend or relative who has managed to convince you of their dedication and commitment. Consideration should also be given to investing in a more established and successful company that is expanding. You will be able to make an informed decision by examining performance over previous years.