A Guide To General Investments And Investment Options
What does investing mean? This is when a person takes part of the money they earn and make the money grow by investing in different things. It is a way to grow your money–and make more money.
Savings Account
Let’s say that you make £200 per week. Each week you take £25 from your pay and you put it into some type of investment. Investments could be as simple as a saving account, to buying shares of stocks in a company. As time goes by each of these options would be expected to grow. The £25 might in times become £30 since your £25 earned interest.
Then the next time you get paid you deposit another £25 making your balance £55 and this week the interest will grow another amount of interest such as £10 which is added to your balance so that you now have £65. This continues for every payday for the entire length of your career so when you retire you have a nice and tidy sum of money to help pay your bills and live on during retirement.
Company’s Investment Fund
The company that you work for also has a fund that works the same way during your career. But this is not a savings account but an investment fund. Every payday another £25 is taken from your check before you even see it and put into your company’s investment fund. It is combined with any money everyone else in your company puts into this fund so that the total amount in the fund is much larger and the investment return that it earns is much larger.
Investment Fund
This money goes back into the company’s investment account and continues to grow, some times larger and other times smaller amounts depending on what the economy in your country is doing. This is all put back into the company’s investment fund and continues to grow for the entire time you are with this company. It can be a large sum if you worked at the same company for your entire career. But you will still get your money if you are “fully vested” in the fund.
With some companies you are vested after 5 years or 8 years. When you retire, you can either get a lump sum of the total you have in your fund, or you can get a monthly payment every month until you die. The monthly amount depends on how many years you worked with the company and if you were fully vested or not.
Private Investing Funds
The company fund invests in a variety of companies or other investment options. Each year you get to tell your company what options you want your money to go into. This is basically simple investment. But if you did this with money from your paycheck on your own, it can become very complex and many people who do this usually go through a stock broker who works for an investment company and they do all the investment for you. They know much more about investing than you do, so most of the time your money is growing as long as the economy of your country is growing.
Simple Investment/Investment Options
Your savings account is an example of simple investment but the fund through your company and your investment companies are both examples of investment options. Investment options include fixed deposits, mutual funds, and equities in stock market, buying land, gold coins, and many other options. You can get more information on investing from the Independent Investor.
Author Bio
Peter Dav has worked for the Great Britain stock exchange for over 20 years. After a vacation Peter is planning to open a stock brokerage firm with three of his friends. They are now in the process of getting information and lessons together to use to work with clients.
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Category: Investing
