Where to invest your hard-earned money?

You’ve worked hard and finally you see that you’ve managed to save a considerable sum of money. What the term considerable means here exactly, depends on a person, obviously. Be it $100, $1000, $10 000, or something remarkably higher than that. Whatever the number is for you, after you’ve spent time to save it, it’s time to start thinking how to grow your savings. Obviously, there are a number of things you can do.

Keeping your money in your savings account, it’s always possible. But, depending on the exact number we’re talking about, the inflation is usually times higher than the interest you can earn on your savings account.

For years we’ve all been told that the safest investments are gold and real estate. Whether it’s true or not is already another story. But historically they can be the most stable investments. But even they can sometimes be very volatile. So in that sense they can be good long term investments, but short term they might lose you money, should you need to use your savings again in a year.

Another option is stocks. There are a lot of stocks that might earn you a lot of money, but when compared to real estate and gold, the volatility can be way higher. And usually you really should know what you are doing. The safest bet here is most likely investing in index funds. While your potential maximum earnings can be times lower than with individual stocks, index funds are times more stable and safer as well. So what is an index fund? Index fund is a type of mutual fund “with a portfolio constructed to match or track the components of a market index.” You can learn more about index funds here.

If you feel like learning trading yourself, you can also think about trading currencies and start trading in foreign exchange market. However, there are two things to consider here. Firstly, the volatility can be sky high here, and if you don’t know what you are doing, it’s safer just to buy lottery tickets online instead as that might give you way better value for your investment. And that’s the second thing, if you really want to trade currencies, you need to start by spending months, years, to learn everything you can about forex trading. As you really don’t want to lose all of your savings in half a day.

There’s not many people out there these days who hasn’t heard about cryptocurrencies. Let’s be honest, nobody (well, assuming you’re not extremely tech savvy) actually understand how they work exactly, but we all know by now that they do. While all started with Bitcoin, and those who bought Bitcoin in the very beginning, have increased they money 10 000 times and over, now there are hundreds of different coins to choose from. Trading these can be very lucrative. But obviously there’s also the other side to the … coin. Cryptocurrencies are also extremely volatile, and often, compared to stocks and even forex trading, the change in prices can often come from nowhere. So there’s a lot of luck, or unluck, involved. As an example, Bitcoin price went from $16k to $8k pretty much in a day. Another coin that I bought for $0.04 went up to $0.29 in two weeks. And now, a few weeks later, it’s back trading at $0.04. So when it comes to volatility, trading cryptos tops everything else.

Where should you invest? Nobody can answer that. However, a smart answer could be that invest in yourself, invest in your education. That could be the best answer. And by investing in your future you won’t lose.