Thinking of saving to take a trip on your next vacation is not bad at all; however, we must not forget the long-term investment goals will be a great relief to be able to enjoy a life comfortable and carefree.
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Most of us see old age as something distant, so we hardly consider this stage in our financial plans or allocate a percentage of savings for this item. Did you know that a person who begins working at 20 would have to save around 10% of his income to ensure a good retirement?
Considering the possibility that annual yields are lower than inflation, as has happened in recent months, would significantly reduce purchasing power at retirement.
Therefore, if you want a larger pension, it is best to consider building an alternative investment plan to complement your savings.
How to obtain good profits?
Many alternatives allow you to invest your money and obtain good profits.
The truth is that there are many more options thanks to the emergence of alternatives such as those offered by fintech that, through digital platforms, offer different possibilities to put your money to work.
There are many types of Fintech; however, some of the most widely accepted among investors are collective financing or crowdfunding, which brings together a group of people to finance projects in exchange for good returns, such as real estate crowdfunding.
Among the advantages of real estate crowdfunding platforms are that they allow you to invest in the real estate market, a historically very attractive market reserved for large capitals until a few years ago.
Also, they allow profits to be reinvested and take advantage of compound interest; in this way, the profits are added periodically (monthly, quarterly, annually) to the capital, so the calculation of the new period is determined with the sum of the capital plus interest.
High or low risk, what type of investment is for you?
Although in the world of investments, there is always a risk, not all the instruments that exist in the market carry the same probability of obtaining the same level of gains or losses. From an investment perspective, there are three types of financial risks:
Currency risk:
Changes or fluctuations that cause the exchange rate in the currency to vary.
Interest rate risk:
The volatility can cause the difference between financial institutions’ active and passive rates.
Market risk:
One is associated with the stock market and its different instruments (stocks, bonds, etc.).
Taking all this into consideration, the measurement of the financial risk of an investment will be directly related to several factors: the currency in which it is invested, the market interest rate, and finally, the type of instrument used.
As a general rule, a higher risk implies a higher potential benefit and probability of loss. We all frequently hear of sharp falls in the stock market or major changes in the price of the dollar or other currencies from one day to the next. These types of investments are classified as high risk and require a high level of tolerance since experts recommend very long terms to be profitable.
Investing In Gold
Investing in gold and other precious metals can be a great way to hedge the risk of inflation and other volatilities often experienced in paper based assets such as stocks and bonds. Historically gold has been a good hedge against inflation because as your dollars have less spending power your gold has risen in value. A great way to buy gold and other precious metals is through a tax efficient gold IRA. A gold IRA allows you to invest within it from pre taxed earning, this means that you do not have to pay tax on money going into your precious metals IRA.
You can also rollover a 401k plan to a gold IRA or part of a 401k plan to a gold IRA. We say part of as we do not believe having all of your assets tied up in any one form of investment is a good strategy.
Having a precious metals IRA plan should help hedge for inflation and protect your money for your retirement, if you choose the correct company to use for your rollover you could also get a big incentive. As an example one of our favoured Gold IRA companies Hartford American Gold is currently offering up to $10,000 in free silver when you open or rollover a qualifying 401k to a gold IRA. Click on the banner below to see if you could get $10,000 in free silver
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