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Nowadays with a world where information can be obtained by our fingertips in which the internet simply has no boundaries. Getting information online is as simple as snapping your fingers, however, one needs to be cautious in getting the right information to avoid getting scammed.

There are tons of websites or apps out there that provide misleading information and some of them can even cause harm to others. So, do your thorough research first especially when getting involved in investment schemes.

One question that always comes to mind will be how will I be able to differentiate which investments are good and bad?

These will be some tips and facts that you should know before investing.

1. Have a Financial Goal

In life we always need to have a goal so that we know which direction we will take and go through, this can also be said regarding any type of investments to avoid making dear mistakes. Your financial goal will indicate whether you will choose a bad or good type of investment

As we can see nowadays, some people love to invest in what most people think is the right choice and rather trending. For instance, you see your friend putting a lot of their money into forex thinking that it will definitely give a high return. Unfortunately, one thing that they forgot to ask themselves is whether it will achieve their financial goal.

Say your friend needs $100,000 USD to pay off their debts once and for all and he/she decided to put the money into the stock market without thinking that it will be worthwhile. On top of that, their act is similar to riding a bull, I mean it's fun and great but rather risky since you never know when you will fall off and injure yourself.


Therefore, it is recommended that the person invest their money in something less risky like a time deposit perhaps. We need to balance between risk and benefit and in this case, having debt will definitely put the person at big risk.

2. Protection is a Priority

Like I said before protection is what's most important before you even start investing. Don't put the amount of money that you cannot afford to lose since you will always need to save some money for the rainy day.

Aside from that, you should also be careful with investments out there that can guarantee you your money and are of risk-free. We all know that it is impossible for any investments out there to have zero risk and people who have been in this industry especially in the stock market know very well that good things don't last forever. 

There will always be times in life when things go south and at that moment of time, you will see the benefit of having 6-month savings, medical card, other side income and worst comes to worst a life insurance.

3. Don't Always Follow Others

What really is meant by this is just because things are going their way doesn't mean that it will for you too. Everybody will have different financial goals as well as different commitments in their life. Therefore, copying the way someone invests is probably not the best idea. 

There are many factors that need to be taken into consideration when making such moves in any type of investment. This includes how much of a risk-taker you are, your financial status, your investment personality, and many other things.

Thus, before you start following other people's footstep and jump in straight away in any type of investments, be sure that it fits the criteria as stated above and you never wants to put all eggs into one basket when it comes to investments.

4. Constant Cashflow is Essential

When you trying to decide which investments are the best for you, you will also waste a lot of time trying to find one. 

It is always better for you to start building your income so to ensure that cash flow is not a problem for you. As you gain a lot from multiple sources then it won't be so hard for you to decide since you can pretty much invest in all of them. 

Rather than focusing on investing your money sometimes, it's also good to invest your own time trying to find another source of income apart from your full-time job.

5. Keeping Money in Your Savings Account?

It is never a good idea to save most of your money into your savings account. Not just the dividend is very low(usually less than 1%) but you will also lose out most of your money from constant inflation each year. 

For example, if your country's inflate rate is 6%, so your time deposit is earning you 3% per annum, you will basically lose 3% of the value of your money each year. 

Therefore, it is wise to put the money in investments with a moderate to a high-risk portfolio in order to beat the inflation for the long-term. It is not a good idea to put all your money into a time deposit since you will surely lose the money in the long run.

6. Time VS Timing

It may sound the same but they are both completely different. You can see the behavior of timing people in those who invest in forex. These people will always try to speculate the market and try to predict when is the best timing to buy/sell the currencies. 

On top of that, it is rather frustrating and consumes a lot of your time to predict. Most financial experts believe that the longer you stay in the market the better it will be for your investments in the future.

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It is better for you to focus on using this time to make more money rather than trying to become a speculator. For all we know, you might lose all of your investments and it is best to stick at the safe side for a more stable income.

In the end, you won't feel stressed out about thinking for the future.

7. Do Some Research and Understand Thoroughly

These days information can be easily obtained from the internet and it should be no problem for you to find detailed information regarding investments. But, you guys do have to be careful with misleading info as you don't want to fall for any scams on the internet.

Most testimonies and reviews are rather fake and you yourself should not fall for people making big bucks investing in the Ponzi scheme. Don't let greed consume you so that you won't lose your hard-earned money.

Always go for investments that have been approved by the government or any financial institutions. 

Be smart and wise when it comes to your money and always use knowledge as guidance for you to invest in your future.

Have you ever fall for any scams or any high yield investment programs?