Hello beautiful people! Today we’re talking about money and women. More specifically, how women can invest their hard-earned money wisely. As the saying goes, money makes the world go round. It would be nice to not have to worry about finances, but life has a habit of getting in the way. The good news is that you can make your money work for you. Most people think about their finances in terms of income and outgoings. Simply put, if your income is higher than your outgoings, then your finances are in decent shape. But the thing is, you can do better than simply okay. If your bank accounts are in the black, then you have an opportunity to secure your financial future.This is something that everyone needs to consider, including single women over 35. Regardless of your financial situation or your stage in life, you can also do more to invest in your future.
How Women Can Invest their hard-earned Money Wisely
When You Should Save or Invest
If you’ve received financial advice in the past, you’ve likely heard many of the same things. For example, it’s usually recommended that you get out of debt if you can. This is because debt costs you more the longer you let it strangle your bank a
ccount. Sometimes loans are necessary, but it’s always beneficial to pay them off whenever you can afford to. Another common piece of advice is to budget. Take note of your income and outgoings, including all of your expenses, and set a realistic budget. This budget may include your regular bills, groceries, loan payments, and fun money. Depending on your needs, you could have a very strict budget. This is recommended if you want to pay off your debts quickly, but bear in mind that such a strict budget might not be sustainable. Once your debt is under control, you should shift your focus to growing your bank accounts. You don’t need to be completely debt-free to think about saving as this isn’t always realistic. While it’s never too late to start, it’s beneficial to save or invest your money as soon as you can.
Why You Should Save or Invest
Everyone should try to save money, even if they don’t have a lot. Emergencies crop up and can catch you unawares, but your savings give you a buffer. You should also save up for large purchases, such as holidays, a new car, or a house deposit. Finally, some people save up for their retirement fund, so they can live comfortably once they’ve stopped working.
A good rule of thumb when saving your money is to have at least three months of your typical living expenses ready in an account that you can access instantly. This means that, should you lose your job, you have some time to find more work. Once you have this, then you can move on to larger savings.
You’ll soon discover that there are several different types of savings accounts to familiarise yourself with. There’s the instant access savings account, which allows you to move money in and out of your account whenever you want. But there are also ISA accounts, which may have more restrictions but are more appropriate for saving larger amounts of money.
But what about investing? The difference between saving and investing is that your money isn’t just sitting in a bank account. Instead, it’s used to buy things that might increase in value over time. Then, when you sell your investment, you will have made money without actively working for it.
What to Think About When Investing Your Money
Investing your money is more active than simply locking it away in a savings account. This means that you stand to earn more money when you invest, which is especially important when inflation constantly devalues our money.
In short, if you put £1000 in a savings account, it will likely be worth less when you take it out after several years. Savings accounts do pay interest which can mitigate this effect, but interest rates aren’t high enough to counter current inflation rates.
However, when you invest your money, you have a chance of growing its value. The key word there is “chance.” The flipside is that it’s always possible to lose money when you invest it in something. The value of your investment can fall as well as rise.
This means that you shouldn’t simply invest your money on a whim. Investment takes research and you need to be willing to take a risk. Different investments are riskier than others. A general pattern is that safer investments change in value slowly, which means that your potential profits are lower. Riskier investments can skyrocket in value, potentially earning you a great deal of money, but remember that the opposite is true.
Most people who invest their money choose to have a “diversified portfolio”. This means that they invest in several different things so that the overall risk is low. Even if one investment loses value, another investment will likely appreciate, meaning that you make an overall profit.
What You Can Invest In
You can invest your money in all kinds of things, ranging from stocks and bonds to property or even small items that you sell on yourself. The type of investment will influence how you earn your money. A robust, diversified portfolio will include different types of investments and assets. Here are some of the most common types of assets and how you’ll profit from them.
If you buy shares in a company, you’ll get dividends, which are the distributions of profits by a corporation or company. The more profitable the company, the more your shares will be worth and the more you can potentially earn. You can also sell your shares for a profit.
If you invest in properties, you can gain a regular income by renting them out. When you rent out a property, you’re typically responsible for maintaining it and managing your tenants. You could use a property management company to make this management easier, while still gaining a portion of the rent. You could also flip properties, where you buy a cheap property and either sell it right away or do a small amount of work to make a larger profit.
Most investments can provide capital gains and losses, where you buy something and sell it for a profit. You can even invest in collectibles for this kind of return, where you buy individual inexpensive items that are worth more as a collection than individually. You can make a surprising amount of profit in niche collectibles.
More recent types of investments include cryptocurrency and even newer NFTs. Cryptocurrency is a digital currency that you can either mine or trade with. You can trade Litecoin and other currencies for a profit. NFT, or non-fungible tokens, are another digital investment, but each NFT is unique.
Managing Your Investments
To get the most out of your investments, you need to manage them and make sure that your money is in the right place. You can do this yourself, or use an investment management company to keep an eye on things for you.
Most management companies or other financial service providers will provide a professional service catered to your needs and can prevent you from making mistakes. However, they will charge a fee and take a bite out of your profits. It’s up to you to decide whether it’s worth it.
The fact is, while you might want to avoid risking your savings, careful investments can provide for you and your family in the future. Again, no matter your circumstances, it’s always worth finding ways to improve your financial situation.
That folks are tips on how women can invest their hard-earned money wisely. I would love to know what your tips are? Let me know in the comments below.