What is a good investment?
With all that has happened the last few months, everything has changed, also the way we look at investments. We all know that we have to invest to make provision for the future, but where would I find a fairly safe investment? Investments are different for each one of us, it depends on your own situation, what you can afford now and what your goals are for the investment. When should I start to invest? According to the well-known writer of financial books, Robert Kiyosaki, the best time to invest is NOW, you do not have to start with much, just get started.
With the internet today, there are countless numbers of investment opportunities available. They are not all good, because there are many sites that are out to make money from the uninformed majority, seeking out possible investment opportunities. You have to be careful and do your research on the companies involved.
How much should I spend on an investment?
The amount you spend will depend on your current budget as well as what your goal is for the investment. If you have time to your advantage, and you can have compounding interest to work for you, that will produce the maximum growth of your investment. A good rule of thumb is to use about 10% of your income to invest on a monthly basis into a investing plan.
If you, on the other hand, have a lump sum to invest, you have to look at an investment opportunity that will produce a return which will outperform the inflation rate. That means if your investment produces for example 8% return per year and the inflation rate is 12% per year, you are not investing – you are losing money, you are going backwards at 4% per year.
Protection against inflation
If you want to make a wise investment, you will have to find an investment that produces a percentage increase which is larger than the inflation rate. Traditionally the only items falls into this category are precious metals like gold and silver. The challenge with both gold and silver is that it is regulated by governments, so the investment process can become somewhat tricky.
Is there any alternatives? The answer is Yes. Bitcoin is an alternative and there are mainly two reasons for this. One is that bitcoin is a decentralized currency system which is not controlled by any banking institution, so banks do not have control over it. Secondly, Bitcoin was created in 2008 and since then it showed a year on year growth well above the inflation rates of all countries.
The question is now, will it be save to invest in bitcoin? Please listen to what Robert Kiyosaki has to say about bitcoin in this talk show between experts on the subjects of both gold and bitcoin:
How do I buy Bitcoin
In order for you to acquire Bitcoin you have to create a bitcoin wallet with a registered provider. A Bitcoin walled is like an “online bank account”, allowing you to deposit funds into it (in the form of ZAR, Dollars, Euro’s, etc) and then you can buy bitcoin within the account and it will be placed into your bitcoin wallet. So, you have an online account with both your home currency and also bitcoin in it. Now you will be able to do transactions with Bitcoin.