The world of investments can be an intimidating place, and it can often seem like a closed club, where the only way in is to have a history of wealth and financial knowledge. The truth is that anyone can invest at any time.
The general type of investment most individuals are aware of is stocks and shares investment (other kinds of investment do exist, for example pensions and property investment). This is the practice of buying a small percentage of a company or financial asset, then simply waiting (or hoping) for the value of that company to increase as time goes on. But can it make you rich?
In short, yes! But how?
Put simply, when you invest for the long term, the general trend of stocks is up. Take the below graph of the S&P 500 (a leading market index for the U.S, tracking 500 large companies):
If you had invested $100 in February 1975, this investment would have grown to almost $8,800 by October 2020. That’s a percentage increase of 8668.85% in just under 35 years, which is a phenomenal return! Of course, this sort of return should not be expected in investments, but it is clear for demonstration purposes what can be achieved in investing for the long term.
The key term is ‘long term’. Those looking to make quick cash in the stock market are often disappointed, or worse, suffer financial loss. Investing is a slow, steady and consistent way to build wealth. You don’t need a significant amount to get started either, there are plenty of ways to get started as an investor in today’s world, it has never been easier to start building your wealth.
And if the phrase ‘long term’ makes you nervous, there are plenty of other ways to start increasing your wealth and planning for the future that we can help with!
For more information on how we can help you start your investment journey, take a look at our Savings & Investments page. If this sounds like something you’d like to receive more advice on, book a FREE consultation with our investment experts at Greenfields…
Phone: 01258 857101
Facebook message: https://www.facebook.com/greenfieldsIFA/
It should be noted that the value of your investment can fall as well as rise and there is no guarantee you will receive a return of your original capital, especially in the early years or if you choose to take an income and investment. Past performance is no guarantee of future returns.