You are not in the 9-5 daily grind because that is where you want to be; you’d love to be getting big pay dividends from the investment market. Discover the answer to five TOP questions on how to get started earning dividends by investing and leaving the 9-5 world behind and gain true financial independence.
Many Australians want to get started in investing in the stock exchange, but they are simply not sure how or have concerns they need answered first. If you have thought about investing to build up your cash reserves and financial stability, here are five commonly asked questions regarding investing and the answers to each.
Investing is a way to get rich without having to go through the daily 9-5 grind and have some independence in what you do every day to earn a living. Now, a quick lesson in compounding.
If you were to diligently save $50 each week and invest in the share market whenever your stash reached $1000, and your shares earned 9% annually, in 30 years you’d have over $440,000. Your investment over the years of your own money would be only $78,000. That’s an investment of your cash annually of $2600.
Throughout the years, there is inflation, rising prices, and dollars lose value and purchase less commodity, which is just a fact of economics. A grocery budget of $100 in 30 years will equate to $40 or so.
This means that if you want to get ahead of inflation, and earn more on your money which becomes worth less over time, you need to invest in the share market. Over the past 20 years, the average has been around 10% earnings annually.
If you are free of credit card debt and most other types of consumer credit, you can usually start investing in the share market for around $1000.
Managed funds generally charge more than necessary and don’t deliver what you thought you were paying for, so you need to be selective in the investment funds you choose. The financial marketing industry would like you to think you need a professional, but if you stick to listed investment companies you are in with wisely managed funds.
Knowing which stocks to purchase is not as difficult as you think. Start with an initial investment at one company. A good company to consider is one that is focused on developing a diversified profile over a period of time.
Small investors can invest in companies they are familiar with and deal with on a daily basis. They often do it before these businesses are caught in the radar of the bigger and larger scale investors.
You can always count on that happening. Again, it is a simple matter of economics. Stuff happens. The stock market has ups and downs just like everything else in life. War, inflation, recession, depression, oil prices, everything plays a part in the up and down game. But for the long term, the stock market is a history proven reliable option.
Do not invest money you will need to tap into and use within a five year period.
Open a savings account and stash money into it so you are not forced to sell when others are; be prepared to ride it out.
Still scared? Don’t be. The more you do this, the better you’ll become at it, and every investor has to get their feet wet first. It’s your choice; 9-5 grind or big dividends; YOU decide.
This article was written by William from Home Loan Finder. Visit HomeLoanFinder to compare home loan interest rates and find the right loan for your next home.