Investing in yourself is the best and safest investment you can make. It involves monetary investment as well as investing in your personal health.
Dictionary.com describes Investment as;
“To spend or devote for future advantage of benefit” and
“To devote morally or psychologically, as to a purpose; commit”
Invest Your Money
Investing your money is using your money to make more money. Each type of investment has it's pros and cons.
Some investments guarantee the original amount of money you invested plus some sort of rate of return. Some investments have no guarantees related to your original investment neither do the investments guarantee that you will make money on them. That's called “risk”.
Basically, the more risk you are willing to take, the bigger the possible returns. This opportunity for a larger return also increases the risk of losing your principal capital. (Principal, by the way, is the sum of money invested).
Types of Monetary Investments
GIC/Term Deposits
GIC's or term deposits are investments in which your principal is protected and an agreed, pre-determined rate of interest can be expected. Investments of these kind are considered to be low risk and therefore usually provide low rates of return.
Stocks
A stock or a “share” is a direct and partial ownership of a company. These types of investments are considered to be high risk and can provide high rates of return. There is no guarantee of your original principal and guarantee of any rate of return.
Some stocks if held, will distribute a dividend to it's shareholders. These dividends are paid as cash directly to the investor or can be re-invested to purchase more stock in the company.
Dividends
Dividend is money you are entitled to, based on your share holdings of a particular company. If and when a dividend will be paid to the shareholders is at the discretion of the board of directors of the company.
Mutual Funds
These are a pool of money contributed by many investors. The money is invested in many different ways. The “fund manager” determines the investment strategy for each fund. The fund may invest in "fixed" investments or, such as GIC, Bonds and T-Bills or it's mandate may be to invest in the stock of public companies.
The company stocks any particular fund may hold varies extensively. For example, a mutual fund manager may decide that a fund will only hold stock in ethically accountable companies that are determined to be profitable.
Investing in mutual funds is considered to be medium to high risk investment with low to high rates of return. There is no guarantee of your principal and again, there is no guarantee of a rate of return. To mitigate risk, one should plan to hold the investment for a period of time. Expect to hold medium to high risk investments anywhere from 5 to 15 years. This strategy should allow for market corrections that can affect the value of your investments.
An investment adviser can recommend holding periods that will help you generate the highest rates of return while taking into account overall risks.
Real Estate
Real estate is a broad subject and many books have been written on this topic. Suffice to say, that it is an important part of any investment strategy.
Investing is NOT Gambling
Investing is not a game of chance. It is also not a “get rich quick” kind of a thing. It is a long term strategy for financial independence. So if you plan to invest your savings, make sure you have a concrete plan.
Invest In Your Health
Most health experts recommend that you dedicate at least 30 minutes a day, 3 days a week, to some sort of physical activity.
Eat foods that are good for your body. Eat slowly and restrict your fat intake to foods that have less than 30% fat content. Shop the “whole foods” isles of your grocery store, where the food choices are healthier.
Plan One Day Ahead
Plan about what tasks you want to accomplish the next day. Plan what you will wear, and don't let distractions throw your daily plans into disarray. Commit no more than an hour of your time to a specific task in one day. Our interest in any activity begins to decline after short periods of time and as a result we are less productive, less creative and are distracted easily. If possible, take a break from a given job and come back to it later. You will get a new perspective on it when you do so.
