InvestmentsMany of us don’t really care so much about finances and investments though it is far simpler than the tasks we undertake in daily life. Most of the people i have spoken to have shown little or no knowledge on how the share market works and many of them see the stock market as a gambling playground. Many of us just have our monies in a tax free low interest bank account which assures us a very low but a constant sum of money every month.

One major reason behind this phenomenon could be the ability to take risk amongst the working class is very less. One of my colleague commented that the very fact we are a part of the working class shows that we don’t like any risks in life. But I think investing for higher gains doesn’t have to be coupled with high risk. There are a number of options available today that suit exactly the risk profile of a person. All it takes is a bit of effort to learn new things about finances and financial planning.

Know your risk profile:

The first thing to understand is your risk taking ability. Are you ready to lose and if so, how much? It is always safe to invest from the point of view that even if you lose all the money you invested, would you be able to continue your life normally? There are many online tools available that would help you understand your own risk profile. Some thing like this, but in your own currency might help : Risk Analyser

Diversify, not DiWorsefy:

Never put all the eggs in a single basket. Always treat these as investments and not as income. It is very easy to get lured by the fact that you potentially can make a lot of money. But it is also true that you potentially can make a lot of loss as well. So try and look for many options to invest and split your investments in all financial instruments you have chosen. At the same time, try not to invest in something you do not understand. If you don’t know what you are doing, you probably would end up unsuccessful, unless if you are very lucky!

Check them often:

Track your investments as often as possible. Make a round-up of all your investments and savings at least once a fortnight or a month. Try and learn if any of your investments have had bad news over the week. Based on your risk profile, assign a “stop loss” and get rid of that investment before it gets even worse.

Financial Advice:

In this Internet era, it is very easy to learn and gain knowledge and at the same time research new items. The same holds true for financial investments. Unless you are not very confident about yourself, you can handle your finances without any external advice. But if you want to seek professional advice there are a number of financial services companies and banks that deal with regular and one-off investments. Try and talk to them.

Finally, always look out for some interesting investment opportunities. There are enough around and it is just a matter of interest and a bit of effort to get your finances sorted.

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