Importance of Investing
Importance of Investing
Even though money doesn't grow on trees, it can multiply when you save and invest it. In the last article we saw reasons why we need to have multiple streams of income. We also find out that to secure our financial future, investment is the way to go. Let's recap some of the reasons why you should go into investing.
When you invest your money works for you
A residual income is what you get from investment
Investing gives you time to pursue your other dreams
It has higher interest rate than bank account
You have more time for your family
Let me explain them one by one. When you work either as a self- employed businessman, a civil servant or employee in an organization or enterprise, you are working for money. When you stop working the money stops coming. In some organizations, if you are late for work, your salary or wage is reduced. But when you invest, your money works for you. Money is a very good employee, it works very hard and earns much for you.
Another good point of investment is that it gives you a residual income. This is a type of income that keeps coming years after you did the work. Unlike linear income, that you get when you work once, you get paid once. To earn residual income, you work hard once and you keep earning from that same one work, years to come. Invest your money once for example in the stock market and you will keep earning dividends every year till you decide to sell off your shares.
One of the best advantages of investing to me is the ability to spend quality time with your loved ones. What is the use of working very hard to give your family the best and yet be a stranger in your home. I heard a story about a banker who lives home before 6 in the morning and comes back around 11pm when the children must have slept. He works so hard that he goes to work even on Sundays. One Sunday he didn't go to work and his children greeted him as uncle and asked their mum who the uncle in there house is.
The interest you earn from investing certainly beats any interest rate you can get from any bank any day, anytime. To be modest you can consistently earn 10-15% on the money invested in good stocks annually. Not to talk of the interest rate in real estate, forex and others. Compare this to the 1-3% you get from banks, highest you get 4%. Ofcourse there is also the risk of losing much money investing, but that what makes the gains so much. As they say, no risk, no reward.
And with proper education, like the one you are getting here, you'll do it right.
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