As they say, money doesn’t simply grow from a tree. But like taking care of a plant through watering, placing it in the right location, and sometimes, giving fertilizers, your finances need the effort to help it grow, too. Here are the three ways to nourish one’s finances.
Investing in stocks
Aside from growing your money, having the right investments can help you save for retirement; a way to do this is through stocks. Stocks, also known as equities, allow an individual to be a stockholder; a stockholder shares ownership of an organization or a company.
Types of stocks and benefits
The two common types of stocks are common and preferred stock.
Common stock is a common equity investment available for investors. It gives a stockholder a right to vote in shareholder meetings; a stockholder has the right to vote who they think is the right person to run a company and how this person should run it.
Additionally, the common stock also allows a shareholder to receive dividends from company profit. In common stocks, the shareholder can also sell their share of the profit. Common shares are liquid; this means it is easier to sell and get cash from these shares rather than selling real estate or other properties.
On the contrary, being a preferred stockholder does not give individuals the right to vote at shareholder meetings. However, they have more priority in receiving dividend payments than common stockholders when a company’s assets are liquidated.
The benefits of having preferred shares are getting a reliable income stream and higher income. Usually, preferred stockholders receive a fixed dividend amount. Additionally, they receive higher dividends than common shareholders.
Where to trade stocks
To trade stocks, one can either reach a brokerage or open an account through an online trading platform. CNBC shares some of the best free stock trading platforms online. The list includes TD Ameritrade, Ally Invest, and Vanguard.
Through these online platforms, an average investor can easily trade and invest. Additionally, these online trading platforms get zero commission, making them more attractive to younger investors.
Another way to earn profit and grow one’s earnings is through forex trading. Forbes discusses everything a person needs to know about forex trading. It is the process of predicting the rise and fall of currencies; the goal is to make a profit.
However, an average investor may find it complicated to deal with forex trading. This is why employing forex traders is crucial; these experts are knowledgeable in the field and can help predict the value of currencies. They are professionals in looking at the different factors that affect currencies, such as the economy and politics.
Aside from earning a profit, one needs to know about the forex market because it impacts the amount consumers pay for export products; it also helps one predict how much they need to spend when traveling abroad. A US citizen, for example, can be affected when the dollar weakens against the currency of the country where they are going.
Investing in education
Unicef believes that education is a powerful investment the world should focus on. Education is the key to employment and is also a major factor in developing nations. The organization states that studies have revealed that education increases a person’s income by 10 percent; it boosts a country’s GDP (gross domestic product) by 18 percent.
Billionaires and education
The top billionaires across the world are nothing without getting a proper education. Here are some of the world’s wealthiest and their educational background:
Microsoft’s founder, Bill Gates, started as a student of a private college prep school. From this, he began to learn using technology such as a General Electric computer and a teleprinter.
At his school, he met his current company’s co-founder, Paul Allen. During his high school years, Gates began to write a computer program, a tic tac toe game where a person can play against a machine. Immediately after graduating from high school, he entered Harvard University. A few years after, he started Microsoft with his high school classmate and buddy, Paul Allen.
Carlos Slim Helu
Currently a telecom giant CEO and Mexican investor, Helu has entered the world’s richest list from 2010 to 2013. Dubbed as the Warren Buffett of Mexico, he leads Grupo Carso and holds massive shares in different industries.
With roots from Lebanon, Helu learned through education and practice. He started working early in his family’s dry goods store and real estate business before entering the National Autonomous University of Mexico with a degree in civil engineering.
Making the right choices
Growing your money is done through making the right choices. Avoiding spending it on things you do not need is one; investing in the right outlets is another. To make the right choices, one must educate himself to make an informed decision.