The act of committing money or capital to an endeavor with the expectation of obtaining an additional income or profit. It's actually pretty simple: investing means putting your money to work for you. Essentially, it's a different way to think about how to make money.
When you invest, you buy asset like shares, mutual funds, gold or real estate when it’s available at a bargain and wait till its price go up. You may have to wait for a long time, say 5 or 10 years to get a real appreciation for your invested funds. Hence, investing is a long term activity because you have to wait for your rewards.
OBJECTIVES OF INVESTING
Objectives or purpose of investing would be different for different people. By choosing to finance your expenses, accumulate money, invest that accumulated fund and limiting the amount of debt – you can achieve most of your life’s goals. Normally, a person would invest with one or many of the following objectives in mind:
· A Regular Income
· Creation of wealth
· Preserving one’s capital
· Planning for retirement life
· Education /marriage of his children.
· To start a business
The process of investing is quite simple- Depending upon the amount money you have, you will have to short list the type of asset suitable for your investment. Next, you’ll have to gather knowledge of that particular asset category in which you are planning to invest your money in. This assessment will tell you whether you are choosing the right asset class for investment, or is it the right time for investment. Once you gain enough knowledge, try to draw a plan to invest systematically – get access to the right information, plan properly and make the right choice.
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