If you are wanting to become more money savvy, it starts with knowing when is the best time to invest your money and where to invest it. Doing this is the only way you will have a good chance at becoming wealthy in the medium and long term.
It is important to know that most people need to do a bit more than just earn money. The money you save from a regular salary, bequests, and windfalls must be held onto and grown. In order for the money coming into your account to grow, it is vital for it to be invested further and not remain stagnant.
How to Become an Investor
Making the decision to become an investor is best made early on in your life as a salaried earner. It is a more complex system than putting aside any extra cash every month into a savings account. Using surplus income to acquire investments that offer the potential for a guaranteed profitable return is possible through one, or more, of the following options:
You can become an investor by devoting your extra monthly cash to anything that has the largest potential for a positive return. Once all outstanding small loan debt has been repaid, such as student loans, it is a simple matter to turn your mind to investment opportunities that best suit your mid- and long-term saving goals.
The First Step to Investing Your Money Wisely
The best time to start investing your money for safe, maximum growth is when you are earning a regular salary and have to find accommodation. It makes no sense, when thinking in the mid- to long-term investment strategy, to rent your accommodation once you have paid off all your small loan debt. The money you use every month for rent can be better put to use to paying off the mortgage on a property.
There are several ways of getting a foothold on the real estate market. The earlier it is done in life, the easier it will be to own an investment that is both an asset and a home. Many potential homeowners are put off with the 20% down payment that is usually required when buying a home.
It is possible to put less than 20% as a down payment on a property as long as you take out a PMI to protect the lender in case of default. PMIs are mortgage insurance fees that will vary in accordance to how much the initial down payment is and your credit rating. On a loan amount of $100,000 and a PMI of 0.5%, the interest will be $250 per annum.
Private Mortgage Insurance can be cancelled when the loan balance has dropped to below 78% of your home’s value.
Other options, that give the first-time home buyers the assistance they need to buy real estate, are VA loans, rural housing loans, and FHA loans.
The Outdated Investment Model of Waiting to Buy Your First Home
Waiting until you are well into your mid-30s before buying your first home is not always a wise investment decision. It is better to buy an investment property as early in life as possible for several good reasons.
And remember, it is not very appealing to have a supposedly carefree existence when you live in a shabby apartment in a bad area and worry constantly about saving for the future. Getting an early start on the investment ladder with the acquisition of real estate and property will pay big dividends in the shortest amount of time.
The final tip to realising the best time to invest your money for growth, is to remember that much of the online chat about renting being the best solution has often been posted by consortiums that are invested in rental properties. Always make your own informed decision after talking to an unbiased investment specialist.