As a beginner, in investing many of my friends often inquire about profitable investment options. It's a question I receive frequently.
Most Profitable Investments That You Can Make
People often ask me about the investments they can make. It's understandable because theres noise, in the market right? People talk about Bitcoin, cryptocurrency, stocks, mutual funds, index funds, real estate, gold, oil...the list goes on. Here's the thing; rich people and the middle class have different investment strategies. Once you reach an income level and become an investor with good credit a whole new world of investment options opens up to you. Sure some of these options may seem risky or unfamiliar at a glance. Suddenly you have access, to a range of investments that you might never have even heard of before.
1. Figure out what kind of investor you are, before deciding on the type of investments you want to invest in.
It's, like when someone asks me "What kind of car should I buy?" Well it really depends. Are you planning to use it for leisure or business purposes? Perhaps you need a car to transport your family around? In that case an SUV might be a choice. If you're someone who enjoys driving cars then a sporty option like a Porsche, Ferrari or Lamborghini could be more fitting – although keep in mind that they come with higher costs and some level of risk. Additionally your age and investment preferences play a role too. If you're between 30 to 40 years old you might be more inclined towards growth oriented investments. However as you get older protecting your capital becomes increasingly important. So overall I dislike the question of "Ukeme what should I invest in?" because what works for me may not necessarily work for you due, to these factors.
Perhaps you haven't reached that point yet or maybe you're not quite prepared to make that kind of commitment. Well you know because I like SUVs doesn't mean you should drive one. Even though I enjoy sports cars it doesn't necessarily mean they're the choice, for you. There are different brands and preferences when it comes to sports cars. For me certain colors or engine types appeal to my taste as specific interior designs. Do you understand what I mean? Ultimately it all depends on preferences and circumstances. The issue is that people often ask these types of questions because they're looking for an answer without putting in the effort to do their research or due diligence. They may not really know what they should do or what genuinely interests them. So when someone mentions cryptocurrency on Facebook and it sounds promising they might think they should jump into it without having an understanding of its implications, as an investor. Similarly if a friend gives them a stock tip they might feel tempted to invest in that without having an investment strategy or vision.
Firstly it's important to understand your investment preferences. Are you inclined, towards growth, capital gain or seeking security and dividends? These factors significantly impact your investment choices. Personally I'm more inclined towards real estate than stocks. However some of my friends have achieved success with stocks. I applaud them for that. Stocks don't align with my preferences because I value having control over my investments. With stocks I can't directly influence the decisions or expenses made by CEOs. That lack of control bothers me. On the other hand investing in businesses suits me better because I can actively participate and have a say in their direction. Real estate appeals to me well because it offers control, over tax implications, cash flow management, appreciation potential and various other aspects.
I have the ability to examine these factors. It operates at a pace. It provides greater stability and always remains up to date.
2. The next aspect to take into account is whether you prefer investing for capital gains or focusing on generating cash flow.
I consider myself a cash flow investor. Unlike capital gain investors who focus on buying assets and hoping for their value to increase over time my goal is to invest in assets that generate cash flow. Speculating on price appreciation can be risky and unpredictable. I prefer the stability of cash flow investing, where I can rely on a return, such, as ten percent. With this approach I know that I will gradually recoup my investment over a period of ten years if the returns remain unchanged.
However if there are opportunities for me to contribute and enhance the investment like purchasing a piece of real estate renovating it and attracting tenants, especially in the realm of commercial properties it can significantly boost the propertys value, which makes total sense to me. This is just my personal preference.
3. The third factor, which is also the crucial depends on the stage you're currently in.
In my opinion if you earn, less than $250,000 annually the most valuable investment you can make is in yourself. Focus on enhancing your skills and expanding your knowledge to improve your earning potential. For instance if you work as a consultant and earn $250,000 per year it may be beneficial to invest in developing abilities such as conducting workshops. This way you can serve an audience, rather than solely working with individual clients. Suppose you invest $10,000 in a workshop program and gain the expertise to offer workshops that generate $50,000 in revenue. In this scenario your self investment of $10,000 yields a remarkable return of 500%.
Now let me ask you a question; where can you find such a return? In any investment it's not possible. So throwing your money at something, in the hopes of getting rich in the process. Why not consider investing in yourself and upgrading your skills? See, when you invest $10,000 into improving your abilities the potential to earn $50,000 emerges. The beauty of this approach is that the knowledge and expertise gained stay with you indefinitely. You can repeat this process over and over again throughout your life. Continue making money. Investing in yourself is a choice. That's why I prioritize investing in my education—attending workshops participating in programs hiring experts or consultants—these are all areas where I don't skimp on expenses. I'm more, than willing to invest because I understand the value it brings. And the key is to keep investing—it's what sets us apart.
Conclusion
I strongly believe that the most profitable investment you can make regardless of your age is to invest in yourself. Once you've taken that step and increased your income it's wise to invest in your business and marketing efforts to attract customers. For example if I spend money on Facebook advertising and get a return of three to five dollars, for every dollar invested in acquiring customers it's essentially a 100% return on investment. This kind of return is hard to achieve with investments but possible when you have control over your business. Therefore my suggestion is to focus on making profits for yourself like reaching a six figure income of $250K. When your business generates substantial cash flow and profit that covers expenses and leaves room, for extra funds then you can consider investing those surplus earnings wisely. However always remember to research any investment opportunity before committing your money. Avoid letting greed dictate your decisions; instead prioritize understanding the investment thoroughly before diving in.
Don't worry about feeling like you're being left out. There's always something to explore another opportunity waiting for you. Make sure to invest in things that you truly comprehend and believe in. Importantly invest in yourself because thats always a wise choice.
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