Everyone loves to attain financial flexibility and freedom. Through this kind of freedom, you do not have to struggle to meet your basic needs. Everything you need, the essential things, are in your life. You can have time for excess and earthly things. Of course, everyone wants to retire with financial security. Being stable and secured financially speaking in your twilight years is nice and you can enjoy life as you grow older in age. Having a job is not enough to give you financial security. There are people who are still struggling to go through a day even if they have high paying job. The main reason is that they lack the right financial literacy. People with high paying jobs and lacking financial literacy will live a very expensive lifestyle. Hence, bills and daily expenses will pile up and it will amount close to the salary they earn. In order to attain financial freedom, you have to live a good and simple life. True and genuine rich people are those who need only less yet essential things in their life. Instead of buying unnecessary things in life, it is better to put money in various short investment options so that when these investments mature, you will have huge sum of money in your pocket.
10. Bank Savings Account
Discipline is important if you want to experience financial freedom. Whatever is you income, you need to allocate portion of it to your savings. Most income is directed to your bank account. Open a savings account in your preferred bank. In your salary, make it a point to save 20% of it to your savings account. 10% you can allot to charitable works and the remaining 70% to your usual expenses. Follow these examples and see how you can experience financial stability in the long run.
9. Foreign Currency
Engaging in foreign currency market is also one of the good short investment options. Try this if you want to invest some of your money, but do not feel good about the economy in US. The holdings in the international currencies are great options to invest because of the foreign market that is increasing in the value.
8. Fixed Bank Deposits
A certificate of deposit or CD having a fixed rate of return is a nice investment option. This one is absolutely free from risk because the money is insured similar to the bank savings account; however, putting your money to cd is more recommended than the savings account because of higher interest rate per annum.
7. Money Market Accounts
The money market account is a savings account type offered by every bank and credit union in the country and is similar to regular savings accounts. However, money market account has higher interest rates and in line with that, it needs higher requirements: the minimum balance is higher than the regular savings account and you can only withdraw three to six times per month. In addition, having many money market accounts will allow you to write checks up to three times per month.
6. Dividend Stocks
Dividend stocks are one of the high yield stocks paying dividend. If you own number of stocks from certain company, you will earn profit from the portion of the company’s income because you are a stock holder. You have the choices of reinvesting into that same company or you get the payout from the company, which is called dividend.
5. Peer to peer lending
The peer to peer lending is one of the riskier ways of engaging in investment; however, you can earn 10% of return on the average. If you are interested in this kind of investments, you can look for companies doing and engaging in the lending industry. There are several companies who are thriving in this industry.
4. Treasury Bonds
Treasury bonds are delivered by the federal government in order to pay for the different government projects. The cash being paid out for a Treasury bond is fundamentally a type of loan to the federal government. Just with any other loan, the repayment of the principal amount is go together with by the fixed rate of interest. These bonds are assured by the federal government and hence, you can say that these are extremely low of risk. One thing to look with these bonds is the inflation. Fortunately, the interest that you can earn on the Treasury bonds is exempted from taxes in both state and local levels. Still, the federal taxes are due on the interest your earned.
3. Short Term Investment Fund
These short-term investment funds can include bank notes, cash, government bills, corporate notes and different safe and short-term debt items. These types of funds are usually utilized by the investors who are momentarily placing their funds before they move them to another investment options that can give them higher returns.
2. Municipal Bonds
The municipal bonds are type of bond issued by the city or even other local government units and their agencies. The municipal bonds can be a general obligation of the one issuing it or can be secured by the particular revenues. Earnings from the interest received by the holders of municipal bonds are usually exempted from the federal and state income tax.
1. CDs
The CDs are the same with bank savings accounts in such a way that these are insured and virtually free from any risk. You can view CDs as “money in the bank”. The CDs are insured by the NCUA for credit unions and FDIC for banks. The difference of CDs from savings accounts is that the CD has certain and fixed term and, most of the time, it has fixed interest rate. It is designed that the CD will be held until it time of maturity and then the holder can withdraw the principal money together with the accrued amount of interest.
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