It is no gain saying that the world experienced a standstill between 60-180 days in different climes. For at least, 60 days, every physical movement ceased, economies paused and markets recorded a downward spiral. Oil went way below, something that had never happened in the history of trade. But then, the pandemic also has never happened to anyone of us. Scrolling through the internet, I saw a statement that told everyone to ease themselves of futuristic planning pressure as no one has ever experienced a post pandemic situation. The truth is, no one has ever seen tomorrow, but still yet we work towards having something tangible to hold on to, for tomorrow. Thus, planning for a post pandemic world is a way to assure our hearts and minds of the positive outcomes that can be accessed in a world where negativity seems to spiral endlessly.
The Pandemic has been associated with issues like loss of jobs, loss of means of income among other mental and environmental mishaps. Fraudsters have come up with ‘amazing’ platforms and processes to defraud people of the little, they have managed to put together. But irrespective of these downtimes, some business are thriving, this means that good investment opportunities may be scarce but they are not non-existent. Therefore we all have to be careful with the investment opportunities we choose to engage in.
Here is the question that we all must ask, what is an investment? A lot of us have vague but valid ideas of what an investment really means but, I would re-iterate our ideas in a more constructive but comprehensive form. An investment is an ‘asset’, ‘item’, or service acquired with the goal of generating income or appreciation. In an economic sense, an investment is the purchase of goods that are not consumed today but are used in the future to create wealth This definition clearly draws a distinction between investments and investment-lookalikes e.g. get rich quick schemes. We should all bear in mind that investment is done for the purpose of income appreciation overtime and not just immediate increment of funds. It is also pertinent to know that, everyone can invest. Don’t be caught up with believing that you have too many responsibilities and things to spend on, and so you don’t have enough to invest because investments are for ‘big people’ (a term used to refer to persons who are extremely wealthy).
Let me teach you something I think you should be aware of in investing most especially if you are just new in the world of investments. They are different type of investments that people venture into:
- Ownership is what comes to mind for most people when the world investment is batted around. These are the most volatile and profitable class of investment. The following are examples – Stocks (owning the portion of a company), all traded securities from futures to currency swap. These investments are purchased by investors in order to share profits, or because they will increase in value or both. Real estate, precious metals are all ownership investments. Here, your expectation of profit is usually, but not always determined by how the market values the assets you own. Business Investment is a type of ownership investment where the money put into starting and running a business is an investment. Truth, entrepreneurship is an extremely hard investment to make, because it requires, not just money but time, effort, consistency among other things, it is still an ownership investment.
- Lending Investments:Contrary to popular belief, where of course you will not be gunning down the borrower, lending money is a category of investing. The risk is generally lower, and it brings in modest profits. A bond issued by a company or a government will pay a set amount of interest over a set period of time. The only risk is if the government/company goes bankrupt. Examples of lending investments are also savings, and as mentioned earlier bonds. Here, the risk is low, interests also vary but are mostly secured.
- Cash equivalents: These investments can be easily converted to cash. Mutual funds are grouped in these investments. A mutual fund is like a savings account and can be purchased at most banks. The difference is that the investor commits to leaving the money alone for a period in return for a slightly higher rate of interest. The commitment period usually spans between 3 months and a year. This is what makes it different from the bond, which would run for 2 years or more.
Dear Investor, here is what we think you should know to guide your decisions in this physically changing world.
When just entering the investment world, you can start with little investments like mutual fund investments.
You can pool your little money together, with other people who have little money as well, and form an investment club, where you jointly make decision on varying investment opportunities.
With the current pandemic, it more preferable to opt for lending and cash investments than dive straight into ownership investments, especially with the dynamism of the investment world.
Don’t leave your money lying dormant, invest it but first understand what you are investing in.
Always ask questions for clarity, visit trusted investments blogs or sites, to improve your knowledge of investments and never stop learning.
The Post pandemic world is tomorrow, the future is tomorrow, the good life moment is tomorrow, invest today, ask about opportunities here today, so you are not caught up in a surprise tomorrow where you might be facing reality and stranded.
I had a discussion with a friend today who wished he converted his money to dollars, before its rates increased. He reiterated that he had the opportunity to, but he didn’t, now he is feeling really bad about it. Therefore, I am urging you to look at the positives that the pandemic can birth, like more knowledge, and investing the little you have. Pool resources with other people, rise by lifting each other and watch your future self, say thank you to the present you.
Thank you for reading this, stay tuned to our blog for more financial education and possible opportunities.
References:
https://www.Investopedia.com/articles/younginvestors
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