Money should work and generate income. That is why, when you have free capital, there are many questions — where to invest the money, how to make a profitable investment, what income can provide this or that type of investment. After reading our article, you will learn where to invest money to have a constant monthly return. Today, there are different investment options — some of them just require capital investment, and for others, you will also need to spend your time.
All the nuances and features of investing, we have tried to understand in this article. The basis for its creation was not only our personal experience, but also the experience of experts in the financial sector, as well as various investors. After a detailed acquaintance with the options where you can invest money and how to properly invest the amount available to you, you can choose the best way to invest.
How do I invest my money?
The term investment means investing your capital for the purpose of making a profit. Usually, the investor’s profit is calculated as a percentage of the annual amount of money invested. Thus, if the contract specifies 10% per annum, you will receive $100 from invested $1000 for the year, i.e. in total you will have already $1,100.
It is necessary to remember that investments are always associated with risks. Spending money is always quite easy. However, do not forget that if you invest money in a non profitable project, there is an opportunity not only to earn nothing, but also to lose some of your capital. And your main goal, as an investor, is to get regular income from your investments, not to part with the accumulated money.
That is why you should take any type of investment seriously and first of all choose the one that suits you and can meet your needs at the desired level of risk and income.
What types of investments are there?
Despite the fact that almost everyone is familiar with the concept of investment, few people know that investment can be different. Before you choose an investment, it is worth making sure you understand the types of investments. They classify investments into several main factors that should be studied in advance.
The object of the investment:
speculative — this includes such investments, which can be earned by simply reselling them;
financial — investment in various financial instruments, the most striking example are shares and bonds;
venture capital — investment related to the perspective of human activity, it may be different know-how, startups, technologies, etc.;
real — the least risky investments in real objects, for example, real estate.
In terms of investment term:
short term — investment for the period up to 1 year;
medium-term — for the period of time from 1 to 5 years;
long-term — for a period of more than 5 years.
In terms of ownership:
private — when the investor is an individual;
foreign — the investor is a non-resident;
state — when the investor is a state organization.
By the level of risk of loss of investment:
conservative — in which the risk to the investor is minimal;
investments with moderate risk;
aggressive — the most risky investments for the investor.
By the purpose of investment:
direct — when a deposit is made in one direction by direct financing;
portfolio — to invest funds in several projects at once, from which the investment portfolio is made;
intellectual — these are practically the same venture investments, i.e. investment in start-ups, know-how, etc.;
non-financial — those that do not require material costs, such as self-education.
What do you have to do before you invest money
So, first of all, it is necessary to understand the features of private investment. For every citizen of Ukraine, who has a certain amount of money and wants to invest it somewhere, it is worth exploring all the pros and cons of investing.
The pros and cons of investing
The ability to generate additional income is our main goal when we are going to invest in something of our own;
the ability to continually update our investments and generate unlimited profits;
as a result of receiving your percentage of the deposit you can achieve your desired goals;
In addition, investing is also an opportunity to broaden your horizons and acquire new skills and abilities.
Do not forget that investing also has some disadvantages that can have a tangible impact on your profits.
Minuses of investing
first of all — the presence of risks, when investing money in any project can not be 100% confident in its profitability, and therefore the possibility of losing part of its capital is always there;
investments require stress tolerance — this means that if you are an emotional person, the process from investment to profit can be quite complicated for you;
it is important to spend time on your self-education — if you are not interested in novelties in the market, there is an opportunity to «lag» behind the trends and simply lose your income;
you need to have seed money — no startup can do without this, so where to invest a small amount of money is the most pressing issue.
5 rules for the future investor
Once you understand the advantages and disadvantages of investing, it is still early to start the process. You should also study the rules of investment. 5 simple rules, based on the experience of investors and our own, will allow you to be more likely to profit from the investment. It is important to disassemble them all by the shelves and clearly articulate your future plan of action.
Availability of free capital
As strange as it may seem, you can only invest free money in something. That is, the money that you have left after receiving your basic income and distributing all your monthly expenses. If you don’t have any money, it makes no sense to take credits or borrow from friends. Because of the instability of the economy, you may not only fail to receive income, but also remain in debt to the bank.
You can only invest in your own business or in another business if you have a stable source of income. If you do not have such a source of income, a contribution to a losing business is a risk of being left without money at all. As any contribution has its own risks — it is better to provide yourself with a job or any other way of earning in advance, which could guarantee you a constant income.
Making an investment plan
Any experienced investor will tell you that you need to plan all your actions before you start investing. The best option is not to limit yourself to a single direction, but to create a portfolio with different investments.
This will allow you to make a guaranteed profit, because there can not be lost several directions at once, which means that out of 4-5 options, some will definitely bring income. In addition, the investment plan will help you make the right decisions in time if the situation does not go as you would like, and thus the risks are minimized.
Investment of profit gained in new portfolios
Since money has the property to depreciate, it is not worth spending the profit obtained from the investment immediately for your own purposes. The best option would be to create other portfolios, which will provide a stable profit in the future.
Control your capital
Many believe that you can just invest in something and forget about it, after a few years, get a good profit. This opinion in itself is erroneous. Permanent monitoring of the project in which you have made an investment will allow you to make important managerial decisions in time, which will be the key to making a profit. Do not forget that now there are many fraudsters and just forget about your investment, you risk and stay without your savings.
Guided by these rules, you can not only guarantee your income, but also to increase it. It is important to remember about each of them and your chances of success will increase.
Options where to invest
Important tips from investors with experience
Before you start investing, it is important to get the opinion of well-known investors on how to act as a beginner, so that not only do not lose their savings, but also to increase them. We have gathered some of the most important principles that will help you achieve your goals.
First of all, experts recommend to protect at least 30% of your capital from the risk of loss. To do this, you should invest them in a win-win scenario. You can open a deposit account or buy real estate. In this way you will save 100% of your money and get a profit from part of your capital.
It is important to create passive income for yourself. To do this, you can invest part of your savings in securities, because it is not always possible to touch and feel the money. At the same time, earnings on shares and bonds can be much higher than from other types of investments.
It should be remembered that by investing money in several projects at the same time, you are guaranteed to get a profit from at least one of them. Portfolios of investments, if you choose the right sphere for capital investment, can be quite profitable.
You should not forget about highly profitable investments. Today, you can find some areas of investment that promise fast, high returns. You can add a small part of such investments to your portfolio — it is important not to overdo it, because you can always win or lose everything.
Do not forget to check the information. You should not invest in something you do not know. Before you invest your money in any project, read the information about it, put all the data into shelves and only then you can make a decision about its profitability. In general, it is better to invest money in projects and ideas that you know, so you can control the situation and make the right decisions.
12 options where you can invest your money
Once you have understood all the features of this type of income as an investment, the time comes for the most interesting — the choice where it is profitable to invest money. Today there are many options for investment. We have collected the most interesting projects in our article, and also tried to consider each of them in detail to answer all your possible questions.
- Bank deposit
Today, opening a deposit account is one of the least risky ways to invest. A bank deposit requires a little money — for a deposit you can choose any minimum amount that you have available and is certainly free. In some banks, to open a deposit it is enough to have 100.
Inflation when investing in a deposit
The problem that can be faced with this type of investment is inflation. The rate of inflation is quite often equal to the interest rate offered by banks. Thus, you kind of earn a certain interest on the deposit, but at the end of the deposit term you will be able to afford on these savings as much as you could afford on the deposit amount, for example, a year ago.
I.e. if you want to put on the deposit account 1000 under 10% per annum. For this amount at the moment you can buy 1 bag of flour and 1 bag of sugar. In a year from the deposit account you will receive 1100, but they will be enough for the same set of products. Besides, it is necessary to remember and that the majority of deposit accounts can be opened not less than for 1 year, and early closing of the account, in case you need money, leads to cancellation of all accrued interest, or their reduction.
Choose a reliable bank for investment
If you decide to open an account with a bank — choose an institution among the proven annual experience, because young banks very often lose out and return their deposits in this situation is quite difficult.
In Ukraine there is an amount of 200 thousand hryvnia, which is guaranteed to return by the state. We recommend — it is better if there is a lot of money, then divide the deposits of 200 thousand hryvnia and put in 5 different banks. So you with a guarantee will not lose your savings and increase them.
It is much safer to put 200 thousand in each bank than to put a million in one bank, because if the bank is in turnover, you will get only 200 thousand guaranteed by the state. By distributing it among different banks, you reduce the risks.
Investing in a mutual fund
A mutual fund is a unit investment trust where each investor has its own share of profit (share). This method of investment is suitable for beginners, because in this case, your money is invested by a broker. The positive thing is that for making a deposit you will need a minimum amount of money — most often from 1000.
The most important thing is to choose a UIF with a good reputation, because the risk of investing in such a fund delivers 50% of 100. According to experienced investors, investing in a unit investment fund should not exceed 10% of the available capital.
We do not particularly recommend investing money in a unit investment trust, because you do not manage your money and other people may lose it. It is better if you lose money by your own mistake than if other people do. It is better to invest in something that you know and can evaluate and manage risks yourself.
Buying real estate
Buying real estate is the most win-win option, which can bring a good profit in the future. The only drawback — the need for a decent amount of money — starting from 20 thousand dollars. Although real estate prices are falling, but in today’s realities it will take more than one year to accumulate this money.
If you still have the right amount of money — in the future you can rent out real estate and get a stable monthly income of about 5-10 thousand, or in the future it is successful to resell and earn.
Investing in precious metals
This is also one of the good options if you consider a long-term investment. Gold is always in the price — you certainly won’t lose out on such an investment, but you may not make any money. In order to ensure greater stability, you can make investments not only in gold, but also, for example, in silver. Thus, even if you fail on one of the metals, the other can compensate for losses.
Do not forget that precious metals are not only bank ingots, but also jewelry. So you will not only invest money in a profitable way, but also make yourself happy with beautiful designer jewelry. In addition, over time, the price should rise. Investments are not for everyone, because you can’t take the money quickly, without losing part of the investment.
Investments in business
It’s a great option only for people who love risk. Any business can be profitable and bring good profits, but not every owner can bring their business to profitability. If you are not yet confident in your business abilities — you can invest part of your capital in the business of another, more experienced person.
As an investment, business is a good option. Here you have full control and responsibility for all risks and success depends only on you and your idea. You can make an online store, open the goods tray, provide a service. Think about what you can be useful to people, and your money invest in the purchase of materials, equipment, goods.
With the right level of faith in the project, effort and perseverance, the investment will pay off and you will earn. This is much more promising than investing in an area you do not know and risk your money. Business is also a big risk, because a lot of things go wrong. But even in this case you will get invaluable experience and by starting over, you can make a profit.
Acquisition of securities
This type of investment is used not only by small but also by large companies. If you have chosen this option of investing money — it is important to choose a good broker who has a license. It is he who will help you in the first stages of buying and selling securities.
This is where they make money on the rise in value. But it also happens that the value drops and you lose some money. In order to predict the results, you should first study this area deeply and invest only when you are sure or believe that the stock will rise in value.
Private Lending (P2P)
Today this method of investment is only gaining momentum, but it has already become quite popular. The essence of it is that you, having your own capital, give loans to other people. For the use of your funds, customers pay you a percentage, which will be your profit.
The main drawback is that there is always the risk of getting into an unscrupulous borrower. In this case, not only will you not earn anything, but you will also lose some of your money, which was given to the borrower. Usually not even a part, but the full amount you borrowed, because the person may just disappear and not show up again.
This is one of the most popular investment methods for Ukrainians. The dollar is constantly growing in price, and the hryvnia is depreciating. You can make good money on the jumps of the rate, if you stick to the main principle — to buy currency at the minimum rate and sell it at the maximum rate.
Do not forget that you can invest not only in dollars, but also euros and pounds. Thus, you will definitely secure a profit when the value of the currency rises again. The method works in the long term 1-5 years.
You may not be able to play on temporary fluctuations of the dollar rate, because it is more of a game for participants of the currency market, who can quickly buy or sell the currency. It is difficult for an average person to keep track of changes in value all the time and guess where the rate will go. Investing in dollars in the long term will be useful.
Investing in art and antiques
This investment is only suitable if you have a real understanding of works of art. In another case, you can buy a painting or sculpture, for which in the future no one will give you and hryvnia. If you do not know art, but still want to invest in this industry — you can hire an expert who will accurately point out the valuable objects and save you from wasting money.
Investing in business
This is one of the most risky options for an investment. No project can guarantee you 100% success and profit. You can invest money in a startup, which after some time will be very popular and will pay you back for your investment in full, or you can get on scammers who just take your capital for themselves.
If you do decide to invest in such an investment — read all the information on the project, carefully select a startup, which in your opinion will be profitable and invest in it a small part of their money, which in case of what would not be so offensive to lose.
This is not so much an investment in an idea, but in people who want to implement it. If you believe that these people can achieve their goals, then you can invest. You just shouldn’t invest in an idea, because it depends on people to implement it. If people are weak, then they can fail the strongest idea. It is better to implement it yourself, if you believe in a project and take part in it with money.
Forex is an international banking currency market, where you can make money by trading currency. This is one of the most popular answers to the question «Where to invest money on the Internet». Let’s say right away that this is a very risky option, but it can also be quite profitable.
The main feature of such investments is the need to carefully study the theoretical part, as well as training on various stimulants. A person without training is unlikely to be able to successfully play on the stock exchange and make a profit — most often, such beginners just stay with nothing.
There is another option — to find a suitable PAMM account with a good reputation. A PAMM-account is an investment service, thanks to which you can earn on Forex not by trading on your own, but by entrusting trading to a broker (manager of a PAMM-account). In this case, an experienced broker will play on the currency exchange, and you will just make a profit. The main thing is not to get caught by fraudsters.
But big risks are just to give your money and never to see it again, because the broker can invest your money in the most risky operations and not to worry about the outcome of the operation, because the profit is guaranteed to you only in words. In fact, how it works.
Investing in yourself
It is quite a popular European way to invest capital. It consists of getting a higher education, attending various trainings and seminars, buying useful books and training programs, travelling to broaden your horizons and many other things that could not only bring you pleasure, but also improve your professional qualities, make you a successful and comprehensive person.
This is one of the best ways to invest and we advise you to invest in business if you already feel empowered, or invest in yourself. Development is something that makes sense in any business. By developing yourself, you gain knowledge and experience that you can apply to build business, relationships and improve your life.
Either way, you can use the development. The main thing is that it can no longer be taken away from you or lost. Therefore, investing in yourself is one of the most profitable investments that you can make. Maybe a course or training will help you make a million.
Investing in commercial real estate is the minimum of risk…
If you have a large amount of free money — anyone will say that the best option when asked where it is profitable to invest money, will be buying a property. Such investment is profitable in the sense that the property is almost impossible to lose, and therefore your money will not be wasted. It is only necessary to consider that this type of investment has some disadvantages:
The need for a large initial capital — starting from $ 20 thousand;
the importance of having additional funds to maintain the property in good condition;
the possibility of a drop in demand for some real estate.
If you are ready to overcome all difficulties — it is possible to pass to advantages of such investment. The main advantage is that, for example, the apartment can always be rented out and receive a monthly income of 5-10 thousand.
Real Estate Investment
There are many types of real estate. Which one is better to invest money in? You will answer yourself this question as soon as you understand your goals. The only thing worth remembering is that investing in commercial real estate is profitable only if you need it for business. Otherwise, you should pay attention to other types of real estate. So, let’s look at what types of real estate there are, on investments in which you could earn:
residential real estate — apartments or houses that can be rented out or resold;
commercial real estate — as mentioned above, is only suitable if it is necessary for business;
land — you can have a good income if you invest your capital in a land plot that can be later leased out or sold for development;
country real estate — also a very relevant option for today, because a good house in the country can bring profits from both leasing and resale, and a holiday home in the resort area will be even more profitable in the holiday season;
under construction — today is very popular investment in new buildings, because it is cheaper option to purchase an apartment from which you can later get a higher income.
Ways to earn money for real estate investments
Everyone knows that real estate investments are always profitable and practically do not carry risk. Unfortunately, not everybody knows that income from apartments and houses can be obtained in several ways.
Rent. This is the most popular way, which is used not only in Ukraine, but also abroad. Renting a house for rent can guarantee a stable monthly income of about 5 thousand. The most successful can be such investment during the crisis period, when the price of real estate falls and you can buy it cheaper, because further renting it will bring even more profit. It is also profitable to buy an apartment in a new building at a rather attractive price and to deliver it further at the usual market price.
Resale after purchase
Further resale. This option is used by a few Ukrainians, although you can make good money on it. You can always find an apartment or house in not quite attractive condition cheap enough, make repairs and after some time to sell more expensive.
You only need to consider that if you own an apartment in the secondary market for less than 3 years, you need to pay extra when selling 5% tax. This can eat up part of your profits.
Investments in new buildings: amount of profit, where to invest, possible risks.
Not all Ukrainians decide to invest in new buildings. Many people think that it is risky. In fact, such investments have their own peculiarities and disadvantages, but they also have many advantages.
First of all, pay attention to the reputation of the developer company. You can read the information on the Internet, view the ready-made objects of the developer, if any. It is also not recommended to invest in projects, construction of which has not yet begun, because there is always the possibility that the construction will end without beginning.
Any new building should be checked before buying. Then investments and risks are reduced and you are more likely to earn money.
Earning money on new buildings is quite attractive. You can earn about 50% from the initial investment. The main factor — the finished object must be in demand. Residential middle class real estate is an excellent option. The difference between the cost of such housing at the construction stage and after its completion is about 40% — and this is already a good income.
Conclusions — where to invest
In general, among all investment options the least risky is real estate investment. So the probability to spend money in vain is reduced to a minimum and, if the right approach to the choice of real estate — you can ensure a good profit.
Using the advice of experienced investors, you will definitely find a suitable investment option. If you want to invest in commercial real estate in Ukraine, then contact InVenture — we will help you find the best option and check the documents.
The second most attractive option is investing in yourself. If you are developing, you will be able to find the most attractive investment option for yourself. On this you will be able to earn considerable money. For example, having learned English or programming, you can move to another country and earn tens of thousands of dollars a month.
The third option for investment is business. If you know how you can help people and are willing to risk your money, then try it. If you know how to cook well, open a restaurant or a small cafe. Repair refrigerators — create a repair firm. Good knowledge of accounting — organize a company for accounting. Do well what you know and you will have money.
We hope that the article by type of investment and investment was useful to you and you came up with some thoughts that will help you make the right choice. Invest in areas in which you know and assess risks. This way you are more likely to earn and increase your capital. Success.