The current economy has given rise to the importance of making decisions regarding what the future holds in financial matters.
Added to the economic imbalance that caused the global pandemic by COVID-19 (coronavirus), this issue is even more worrying if you belong to an economically active generation that lost the right to a pension. For more details visit this betting portal
Today, young adults born between 1981 and 1994-millennials-must ask themselves what they can invest in or what is the best strategy for a good investment.
The fear of investing is greater than before and financial anxiety increases as time goes by. Every person of productive age should begin to prepare for retirement, even if it still seems very far away.
To start building wealth – personal or family – it is important to learn about the best investment strategies, and not get carried away by fads that promise quick and effortless payback.
There are hundreds of books, studies, and articles on the importance of investing in our most productive years. Therefore, below we will talk about the most important investment tips that cannot be missing in your financial planning.
Investment tips to increase your capital
The way to achieve a future of economic stability begins by listening and assimilating the knowledge of others who have made a career in the field, and who can teach a lot about it.
One of them – perhaps the most famous – is the investor Warren Buffet, for whom an investor is not the one who does extraordinary things, but rather the one who is able to avoid a greater number of mistakes.
These tips, without a doubt, are an excellent way to start building a future:
1. Look for information about the investment options that exist
The financial market offers a wide variety of options for those who want to put their money to work and obtain returns.
Among the options that appear as the favorites, we find fixed income investments, variable income, and investment funds.
One way to choose the type of investment that suits you according to your age is the Rule of 120. The purpose of this is to calculate the risk obtained from an investment according to the age of the investor.
To start investing in the future, the first thing to do is:
- Gather all the necessary information about personal finances.
- Know the relationship between income and expenses.
- Establish percentages to allocate to necessary expenses, savings and investments.
- Find other sources of income.
- Set a time horizon, that is, the time that the capital is expected to be invested.
2. Know the financial behavior of the chosen market
According to the study “Financial culture of young people in Mexico” carried out by Banamex-UNAM, 56% of the economically active population is experiencing financial problems to make ends meet, with little or no possibility of saving or being candidates for bank loans.
However, an important part of this generation does have savings, most of which are stuck in a debit account you should not invest in what you do not know well and do not understand.
Taking the time necessary to understand the financial behavior of the markets where we are interested in investing will make the difference between a successful performance or a loss of capital.
The financial market – as well as its different products – is constantly changing, so you should not rely on current figures, but review the history of a few years to verify that said company or product has remained stable over time.
Peter Lynch, one of the most successful investors, advises investing only in what you know. This means that, in addition to being clear about the financial possibilities, it is necessary to continue investigating; not because Bitcoin or a new business is fashionable, it means that they are the best investment.
3. Set investment goals and objectives
It is important to chart a path when it comes to investing. The first thing is to start with an objective, for example, to invest in real estate.
For Eric W. Anderson – a renowned financial analyst at RBC Wealth Management – time is the most important factor to consider
The first thing is to reflect on the objectives, the term, and the risk tolerance. You have to be honest and think about whether the idea of volatility and risk creates discomfort, or if you are willing to invest in high-risk assets.
If you’re going to invest, identifying your goals, expectations, and anxiety triggers helps you make a better decision.
The next thing, in the case of investing in the real estate market, would be to analyze the possibilities of paying with the money saved or applying for a bank loan, either individually or combined with that of another person or persons, for example with real estate crowdfunding.
In this case, investing in a real estate trust could also be considered.
4. Consult a specialist
Although great investors have more experience, it is always good to consult with a financial specialist when it comes to investing money.
The help of a professional in the field can help resolve doubts that remain after the investigation, however, although the advisor’s opinion is important, making the decision – of how to invest the capital – is your own.
Having specialized advice will give you the security of taking the right path.
When it comes to real estate, you can find real estate companies – such as BMF Inversiones – with a lot of experience in the field, as well as evidence of successful projects that generated great returns.