We lived in Costa Rica for a while from 2011 to 2017 to stretch our retirement savings plan a little. It worked. But if moving to Costa Rica isn’t in your future consider this:
Believe it or not, there was a time when $30,000-$50,000 a year meant you were doing pretty good. Nowadays, having a combined income in this range means you’re considered “the working poor.” If you want to make it in this day and age, you’ve got to be smart about your money. More than just budgeting and saving, you must essentially learn how to make the most of the income you have.
Investing is one of the most popular ways to do this. Putting your money in the right account, stock, mutual fund, tangible item, or real estate can increase your finances by leaps and bounds. Here’s a look at how to be successful at personal investing.
Choose a Strategy
To blindly start putting your money everywhere would be a mistake. Not all investment strategies are designed for every person. Each method you consider will have a different set of requirements, rules you must follow, the money you must invest, and strategies you must employ to grow your wealth. You must first determine which investment strategy is right for you based on your long- and short-term financial goals. Some of the most common investment strategies include real estate, foreign currency, mutual funds/stocks, and tangible items like gold or antiques. Research each of these methods and see which best suits your needs.
Create a Plan
After researching and selecting the right personal investment strategy for you, it’s time to create a plan. Let’s say you decided that you were interested in investing in the stock market. There is a lot that needs to be understood before getting started, so educate yourself on things like stock market terms, predictions, stock market holidays 2019 (or whichever year you intend to start investing), and the risks involved. Then you would need to determine whether you’re going to manage your brokerage account on your own or if you’re going to need a lot of assistance. Next, you’ll need to open a brokerage account, set a budget, and select stocks to invest in. Coming up with a stock market strategy is also ideal.
Stick to It
Here’s what you must know about personal investments – you’ll have to put in work and there are risks involved. If your chosen investment strategy is real estate, then you know you have to find properties at a decent value, find the resources to invest in that property, and then decide whether you’re going to sell it for a lump sum of cash or rent it out for passive income. Through this process, there will be bumps in the road that can make you feel discouraged. Having to pay more for a house as a result of a bidding war, finding out there is more damage than you budgeted for, not being able to find buyers right away, or having problematic tenants can all occur. In these instances, you lose money, but sticking to your plan and remaining consistent is often the key to overcoming these occasional temporary setbacks.
Chances are you’ve been told at least once in your life that you shouldn’t put all of your eggs in one basket. This is a very true statement when it comes to personal investing. As you know, there are a lot of factors that play into your success with any strategy. A slow rental or real estate market, the ruined reputation of a company you have shares in or a decline in market value on items you own can reduce your earnings. That’s why having more than one source (diversification) is pertinent to your success. Find more than one way to invest your money, create a plan, and stick with it.
Achieving long- and short-term financial success through personal investments is one of the smartest things you can do to grow your wealth. If you’re considering investing as an option, be sure to review the various types, educate yourself on the pros and cons, select the strategies best suited for your needs, create a plan of action, and stick to it even at times it feels like a setback. In doing so you’ll find that whatever you earn in a year will last a lot longer.