Long-term investments don’t only mean financial investments. There are also personal investments that most of us make, or should make, at some point in our lives.
Some come naturally as we grow older, while some take a little bit of financial responsibility and long-term financial planning. Here are the five biggest long-term investments everyone should make in their life.
When hearing about investment, you’re most likely tempted to think of stocks, equity funds, currency, and other popular types of financial investments. Yet, investments don’t just limit to this. An investment can be basically anything you put your money in at the present moment and benefit at some point in the long-term.
When you make personal investments, you basically make your financial future look brighter. Why is that? Because you know that some of your income is being steadily invested in one or more long-term wealth creation tools.
Let’s see the five biggest investments we should all make throughout our lives for a more secure financial future.
You know what they say, “knowledge is power,” which is why the best investment is in yourself.
There are thousands, if not millions, of various investment tools out there, such as mutual funds, bonds, currency, and many others with initials that you can’t even pronounce. But did it ever occurred to you that the best investment is right in front of you when you look into the mirror? That’s right, investing in yourself can be the best investment decision you make.
Now, investing in education is one of the personal investments that most of us make naturally throughout our lives, especially if we invest in higher education. But make no mistake, investing in self-education doesn’t only mean more school. Sometimes, it can be as simple as attending a new course, watching a webinar, listening to a podcast, or reading a new book.
Why is your education a good investment? For a thousand of reasons, including the fact that it can help you land a high-paying job, it can help you create a network of influential people or can help you learn how to manage your money or other investments better, to name a few.
Now, you don’t have to invest in various different properties because maybe you aren’t, and you’re not planning to become a real estate investor. Yet, buying the right home and be a great investment in the long term. Why? Because the home you buy now for a certain amount of money could be worth twice or three times more in a couple of years. So, if you decide to sell it, you’ll gain a substantial profit.
Now, investing in a property is another personal investment that typically comes naturally in our lives. As we grow older and what to settle down to our home, we become homeowners.
But, if you want the house you buy to be more than a home, make sure it is a good investment. For example, you can buy a property in a neighborhood that is developing for some time now. Property prices in such areas are usually low, and, as the area extends, they tend to increase a lot over time.
3. Life insurance
There are thousands of types of insurance out there. Do you need all of them? Absolutely not! (unless you are a really paranoid person and fear anything from alien abduction to dying of laughter).
However, there are a few types of insurance that we all need to protect our financial future in case the unplanned happens, including auto insurance, health insurance, homeowners insurance, and life insurance.
Life insurance is, by nature, a long-term investment. Every month, you make a payment, and when the time comes, your family will get a more significant amount of money. In fact, the main reason people get life insurance is to protect their family members’ financial future in case they pass away, especially if they are the only bread-winner of the household.
Now, financial advisors recommend you choose a low cost life insurance, which is not the permanent life insurance but the term one. Why? Because the term life insurance is typically less expensive than permanent life insurance, which leaves you more free money to make other investments that can offer a better return.
The times when the business world was only for the big players are long gone now. Thanks to the Internet and the impressive growth of e-commerce over the last few years, anybody with an excellent business idea, and some capital can become an, at least, profitable entrepreneur.
Now, all you have to do is to take something you are good at and interested in and turn it into a business. Not only that you may make some extra cash, but you’ll also broaden your business perspective and possibly change your career and become a successful entrepreneur instead.
5. Retirement fund
Most young people neglect retirement, thinking that this chapter of their lives is so far away. Too many people wait until they get in their 30’s before they start investing for their retirement or invest too little, when, in fact, retirement should be one of their priorities.
Data shows that people are now living longer than ever, so the chances are that you’ll get to live the retired life you deserve. Invest in retirement now to have a stress-free retired life in the future.