If you are thinking about becoming an investor but have no idea where to start, you’re not alone. Many people are intimidated by the thought of investing and it can seem daunting if you don’t know the basics. This article will give you a crash course on investing and show you how to get started, even if you are a complete beginner. Here are 5 practical tips for first-time investors
Learn The Basics.
Imagine you own a car, and you sign up to be an Uber driver and make some extra money on the side. Or, if you own a house, and you rent it out and make a profit. In both cases, your car and your house become assets and investments. Investing is simply the process of acquiring an asset or an investment. It refers to the act of putting money into something with the expectation of earning a profit – return on investment. For example, you can invest in a company by buying shares of its stock. Or, you can invest in a piece of property – investing in real estate.
There are many different types of investments, and each comes with its own set of risks and rewards. However, in general, investments can be divided into two main categories: active and passive. Active investments are those in which you actively manage the asset or investment.
For example, if you buy a stock, you may need to actively monitor the company’s financial performance and make decisions about when to buy or sell. With an active investment, you have the potential to make more money, but you also have more risk.
While a passive investment requires very little active management on your part, and it generally has lower fees than actively managed investments. While you may not achieve the same level of returns as you would with an actively managed investment, you can still potentially earn a decent return on your investment over the long term.
Essentially, an investment is anything that you acquire at one price with the intention of selling it in the future at a higher price, or something that you own that brings you money.
2. Understand why you should invest
On the surface, you should invest because it’s a good way to earn more money or an additional source of income. When you invest, you’re essentially putting your money into something that has the potential to grow over time. This can be a great way to secure your financial future and build your wealth over time. Of course, there are always risks involved with investing, but if you’re smart about it, investing can be a great way to earn some extra money.
Now on a deeper level, you should invest because it helps to protect your money against inflation. Saving is great, but inflation happens. The annual inflation rate in Nigeria accelerated for a fifth straight month in June of 2022, reaching 18.6%. This is the highest inflation rate since January of 2017, and compares to 17.7% in May. It’s crazy to think about how much damage inflation has on the value of money.
To give you some context, if you had ₦100 in 1960, it would be worth around ₦567,000 today. That’s a 566,990% depreciation rate in 62 years! This goes to show how much the value of money can change over time. Inflation has a negative effect on or reduces the value of your money.
Smart Payment Solution
This is where investments and smart payment solutions providers like Kalabash come in. Kalabash offers various solutions that protect you from inflation by allowing you lock down current prices with as little as 25% down payment of the total cost and pay the rest in convenient instalments. With Kalabash you don’t have to worry about price increase or inflation. When you invest your money, it works for you and grows over time. You’ll need to find investments with returns or interest rates that are higher than the inflation rate in the economy or payment solutions that protect your money. This can be a challenge, but it’s important to keep your money working so that you can maintain your purchasing power and keep up with the rising cost of living.
Get Started Now
There’s no time like now when it comes to investing. The sooner you start, the more time your money has to grow. Investing early on will allow you to take advantage of compounding returns, which can help you build wealth over time. While there’s no guarantee that investing will always lead to financial gain, starting sooner rather than later gives you a better chance of seeing positive results.
Consistency is key if you want to become wealthy through investing. Most people who become wealthy investors do so because they’ve made investing a regular part of their lives. By setting aside some money each month to invest, no matter how little, you can gradually grow your wealth over time. And the sooner you start, the sooner you’ll start reaping the rewards. So, if you’re serious about becoming wealthy through investing, make it a priority to start investing regularly today.
If you’re not sure where to start or how much you want to invest, that’s okay! Research and ask around about different options like Bank Investments, Cryptocurrency and Blockchain Investments, Real Estate Investments, Agriculture and Livestock Investments, Bonds and Stocks Investments, or even starting a Small Business. Start small and build over time. You can also check Inside the Kalabash for solutions that help you lock down prices. The important thing is to get started and choose an investment that you’re comfortable with. Most apps or platforms like Agro Partnerships, Bamboo, Piggyvest, Rise Vest, Trove, Go Money, Cowrywise, Thrive Agric will have a minimum amount that you can invest, so be sure to check that before you get started. Good luck!
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