Why Invest ?

“Price is what you pay. Value is what you get.”

By Warren Buffet

In other words, don’t focus on short-term swings in price, focus on the underlying value of your investment.

There are two different ways to bring in cash in our cutting edge world. The principal path is to earn an income, either by working for yourself or for another person. The alternate method to develop your fortune is to contribute your resources with the goal that they increase in value over the long run. Regardless of whether you put resources into stocks, securities, choices, valuable metals, land, independent venture, or a blend of the entirety of the above mentioned, the goal is to produce money. Investments may include a range of choices, including stocks, bonds, mutual funds, exchange-traded funds, and real estate.

An individual's investment goals depend on his or her income, age, and risk tolerance. As a youngster, stocks are an ideal spot for you to begin contributing. Indeed, they accompany high unpredictability, which is one proportion of danger. Yet, over the long run, they offer solid returns. With time by their side, youth has an incredible advantage over their older counterparts. That advantage is called compounding, which is an ability of an asset to generate earnings, which are then reinvested or remain invested with the goal of generating their own earnings. Even someone earning minimum wage their entire life could become a millionaire if they invest every month for 40 years. But it takes a high salary to try to play catchup and save for retirement in only 10 to 20 years.

As a student, you probably don’t have much money to invest. Don’t sweat it; you don’t need much to get started. What you do need is dedication to the idea of building wealth. It takes consistency, patience, and faith that even though markets drop periodically, they will rise again with time.

For beginners, investing in crowdfunding and peer-to-peer lending is a great headstart. While crowdfunding websites only accept money from established investors, peer-to-peer lending is an open platform for all sorts of investors .Here are a few options available to students for crowdfunding : Fundrise, RealtyMogul and Groundfloor. A few pitfalls to avoid as a young investor are : Don’t buy stocks or funds on margin and avoid starting an investment before getting rid of all debts.

As a young person, you’re in a particularly strong position to get a head start on wealth building. Take advantage of compounding and time. To leave you with one final demonstration of its power, consider this example: If you invest $550 per month for the next 10 years at an 8% return, then stopped investing entirely and just let the money grow over the next 30 years, you would end that 40-year span with roughly $1 million.

Summary:

Investement at an early age can give a major headstart in making money from money itself. An individual's investment goals depend on his or her income, age, and risk tolerance. As a youngster, stocks are an ideal spot to begin with. Over the long run, they offer solid returns. For youth, with not a huge capital, peer-to-peer lending and crowdfunding are also few of the options. The market is wide open with countless opportunities gazing at you. All you have to do is be well informed and invest smartly.

By Apala Gwalera