Best Investments
What have been your best Investments to date?
Im not just asking about stocks. Is there any investment that you look back and said “man If I could do that again I would put twice as much in it.”?
The 3 Best (and Smart) Investment Methods in the whole world, undeniably, are…
1. Work – working is one of the best investments because the rate of return per annum is extremely high. There’re 2 calculations here: the 1st is investment on yourself. Let’s say this month you spend $1000 to support yourself so that you can continue to live and work, and your salary end of this month is $2500, that makes your rate of return as much as 250% in a month. That will be 3000% a year! Just by working (for others). The 2nd calculation can be based on your savings. Let’s say you have $250,000 in your bank account debt-free, and your salary this month is still $2500, that makes the rate of return as much as 1% a month and 12% a year. That’s still a decent return based on this 2nd calculation although I much rather prefer the 1st. By the way, your salary will increase, so that means your rate of return will also increase.
2. Save – saving is another wise investment methods. There’s this Rule of 72 used to calculate how long you need to wait for your investment to double up. If the annual rate of return is 10%, then you’ll need to wait as long as 7.2 years to double your investment. Let’s say if you save a decent $200 today, you’ll need 7.2 years to double to $400. However, if you save only $100 today (a mere $100 difference), you’ll have to wait for 14.4 years to reach $400. That’s double the time just because of that small difference. Unfortunately, not many investment can generate 10% annual rate of return (or more), consistently every year. Regardless, to save is still a great investment method. The more you save, the more you have (by cutting down on wasteful spending). Put your savings in your bank account to give it some boost in fighting off inflation.
3. Do Business – operate your own business is another best investment. Basically, that’s when you can earn high return through great products and services. However, there’s a rule and that you must generate annual rate of return higher than the return when you work for others. Or else, it’s better to sell off your business and return back to working for others.
That’s it.
Some advice…
NEVER invest in mutual fund (and unit trust) unless you see yourself as a lazy and stupid person. Neither should you invest in stock market (directly). I don’t mean mutual fund is bad. It’s just not as good as stock market. I also don’t mean stock market is bad either. It’s just that if you want to invest in the stock market, you must…
1. Have a looot of time.
2. You’re so smart your ROI (return on investment) on stocks is higher than working and running your own business – possibly because you’re just too familiar with the stock market.
One more thing, mutual fund doesn’t guarantee that your investment will not dry because of recession. So unless you’re lazy and stupid, I advice you take control of your own money by Working, Saving, and Running Your Own Business.
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