Finances can be a scary topic, especially when it comes to earning money, making sound investments, and the real estate market.  Knowing where to turn to can be difficult.  There is so much advice out there, it can be hard to narrow down what is sound and what is not quite as good.

There are plenty of self-help style books out there that can help in this process.  I know I was somewhat skeptical of this sort of thing at first, so I understand if you are too.  That being said, this kind of advising can be invaluable, especially if you are struggling with how to invest in your future.

What is Investing?

As with most topics in this realm, the answer to this question is multi-faceted and somewhat complex.  There are many ways that you can make investments.  The first thing that comes to mind for many of us is the stock market.

The Stock Market

Now, trying to understand the stock market can be challenging.  If you are curious about it, you can always read more on this page: https://www.investopedia.com/terms/s/stockmarket.asp.  Of course, I am more than happy to discuss it further as well.

In easy terms, the stock market is an umbrella term for the group of exchanges where buying, selling, and trading of public shares of companies takes place.  These interactions can happen in person or online via an over-the-counter marketplace.

The largest stock exchanges in the United States are the New York Stock Exchange and NASDAQ.  The main things to keep in mind if you opt for this style of investment is there are certain regulations and securities put in place.  These are created by the Securities and Exchange Commission in the U.S. 

You will want to research what investments are the soundest.  There is always some form of risk in this kind of purchase – a stock you choose may depreciate instead of increase.  All that being said, it is really not as intimidating as it may sound.  There are a variety of resources into which you can look.

Retirement

 The next type I will discuss is critically important – retirement funds.  This is something that I was always very confused about.  So many young people hear their parents and grandparents talking about retirement, but we are not taught what it entails and how it works.

Some of the safest choices are 401k and IRA funds.  You can choose to automatically deposit parts of your paycheck into these each month.  401k funds are created by private employers, while one of the similar branches (457 plans) are for employees in the public sector.

What you should note about these funds in a traditional plan is that they will be taxed once you withdraw them from your retirement account.  This is because the pay that your company reports to the IRS gets sent to the account without being taxed up front.  Thus, it is taxed when you take funds out.  It works a bit differently for a Roth 401k.

Real Estate

Another form of financial investments is real estate and that market.  It is a bit enigmatic to many of us, but there are plenty of ways to get more information about this topic, do not worry.  The housing market tends to fluctuate with the economy, at least to some extent.

Something interesting about purchasing properties is that it works differently than stock.  You can use something called “leverage” to purchase land.  This means that you pay part of the total cost up front and pay off the remaining balance gradually over time.  There are a few different options for mortgages than you can consider.

It may seem strange to consider buying homes or properties an investment.  However, there are few ways you can make money this way.  Perhaps the most lucrative is becoming a landlord.

Landlords rent out space to tenants.  There is usually a monthly payment involved.  Something important to note is that the spaces provided need to follow certain rules and regulations.  This is not something to pursue lightly.

You will want to prepare the property for potential renters.  Keeping it clean and maintained is a key part of the renter and landlord relationship.  You will be responsible for repairs and fees associated – that is one of the reasons that people rent rather than buy a house, after all.

Another method of money making in this field is house flipping.  We see a lot of this on television, but it is an option available to more than just the celebrities.  Anyone with the means can purchase low value real estate and increase its value.  It often involves a lot of do-it-yourself projects to really make the most of your money.

Cryptocurrency

The final form of investing that I will mention in this article is cryptocurrency.  This is a fairly new style of financing, so I think it is important to talk about.  There is a lot of misinformation about it and it is hard to wrap our minds around it.  How is digital currency an investment, and how is it worth anything?

The most famous of them is called Bitcoin, but the market has been absolutely flooded with them.  There are a lot of suspect coins, so it is critical to do your research before you purchase them.  Some by YouTubers and other social media influencers have been revealed to be scams.

Most of these currencies are purchasable for United States dollars.  That is probably the easiest way to obtain them, via safe and secured platforms.  There are virtual banks and storage options available for them as well.

If you are considering this option, just do your best to investigate the coin you buy and the platform you purchase from.  It is the most “modern” option of these options, but that does not make it the soundest.  More traditional styles of financial investment may suit you better, so be sure to consider all your choices first.

However, you decide to continue investing, I wish you the best of luck!