The term of investment is so familiar nowadays. Moreover, it is often suggested by financial planners as a way to add more the number of wealthy. Nevertheless, there are some primary things you should have before you start to invest your money. Those three things are knowledge, time and money.
Knowledge is one of the most important things you should have before investing your money. In fact, it is to be the most important thing over the money itself. It means that you have to know how it works, the mechanism, the return and the risk of the investment itself. On the other word, before investing your money, you should invest your brain first. It is because abundance of investors are failed or even cheated because they are lack of investment instrument knowledge as well as the risks.
If you have 100 years, you will enough time to raise your goals related to the financial. But, the fact is that you have only a short-term mostly. Or this, you need to separate the investment goal from the time section. There are three separation of times, short-term, middle-term and long-term. The time difference of the goal among the three will affect the investment instrument chosen. The short-term goal should be using the investment instrument that gives you low risk whereas the long-term one, you can utilise the instrument with a big risk but has a potential return as well. Some instruments are arranged from the lowest risk to the highest ones: deposit, obligation, mutual funds, mutual funds shares, property and the last is derivatives.
Every investment needs money. You just need to determine the number of the money you own to invest. If the value is low enough, it is better to invest it routine. If the budget is many enough, you can separate the investment models to several instruments. One of the primary keys of success in investment is the source of the money to invest. Make sure you use your cold money. It means that you have spare money you do not use at all for your daily needs.