There are various mediums or platforms to save your hard earned money and also to grow your money but each of them have their risks and earning potential. Some of points we discuss as below:
1. Savings Account: One of the mediums which people usually use are the savings account whether it is a bank or a post office. This also has some risks like paying of less interest for your savings but with low risk on losing money.
2. High Yield Savings Account: If you maintain the minimum balance as per the rules of various banks or other institutes, you can also open a High-Yield Savings Account. These types of savings account provide you with interest rate compared to Normal Savings Account. Research for same is mandatory by each individual.
3. Certificate Of Deposit (CDs): This medium also requires thorough research on individual part. This medium provides a higher interest rate compared to savings account in common but you need to lock the money for certain period of time before you can withdraw the money. So start if you have some extra money and don't need money in urgent situation.
4. Stock Market: About all the people in this world would have heard about the stock market. This medium or platform is also risky to park your hard earned money but if you invest your money with thorough research, then you can earn more than the savings account interest rate. The only catch point here is that this platform carries very high risk of losing all your money.
5. Bonds: You can invest in bonds which are less risky and provide you with regular interest payments. We say this medium is for conservative thought people. These are less risker than investing in regular stocks. We can invest high risk bonds like Corporate Bonds or we can invest in Government Bonds which consist of less risk compared to Corporate Bonds.
6. Real Estate: Investing in real estate will provide you with rental income and price appreciation over a long period of time. But many people cannot invest a huge sum of money in that. So, people can invest in REIT, a type of stock in stock market which can bring in some interest payout via the form of dividend.
7. Mutual Funds: Another great platform is investing in mutual funds, these help people to invest in diversified portfolio where the investors risk is distributed among stocks and bonds. You can start investing in mutual fund from very less amount.
8. Exchange Traded Funds (ETFs): These are very similar to mutual funds, but trade like stocks in the stock market. These also have the potential to grow your money over a period of time. Research is thoroughly needed by each individual before investing.
9. Retirement Accounts (401k or IRA): These mediums are good for tax advantages and long-term savings for your retirement plans. Many still don't know about the types of accounts which can be opened to avail tax benefits.
10. Peer-to-Peer lending: Very few people know or use these kinds of medium to lend money and grow the hard earned money through interest payout while your lend your money to individuals or small businesses.
11. Precious Metals: Another very interesting medium is investing in gold and silver. These can help you in your distress time or against economic conditions.
Some Pro Tip:
1. Education and Training Programs: Investing in yourself, achieving success in your education and joining in some value added training programs and developing your skills can definitely increase your income in a long run.
2. Entrepreneurship or Business: Ever thought of starting your business or being an entrepreneur. Both these mediums can bring in money and get you ahead of many in a rat race to be financially free. Only thing is that, you have to be consistent in what you deliver whether it is a product based sales or just a service based business.
Always remember to choice in such a manner which can be aligned with your financial goals. tolerance to risk and time horizon. With the above said, diversifying your investment in different mediums can help you in the risk management and optimize your returns. If need be, you can consult some good financial advisor as per your financial goals and circumstances.
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