Best way to invest money

The best way to invest money is a question that has been asked by millions of people and has no definite answer. If you ask 10 different accredited investors what is the best way to invest money you will probably get 5 different answers. Everybody has there own opinion on the best way to invest money. So what is the best way to invest money?

First, there are those who say that the stock market is the best way to invest money due to the high rewards you can receive if the stock soars. The stock market is the only investment area where you can see you money multiple ten fold over the course of a week, thus making it seem to be the best way to invest money. Also, you don’t need to have large amounts of cash on hand to be able to get involved in the stock market. Many people will start out getting involved with penny stocks, which can be purchased as low as 1 cent. Therefore, if you invest only $20 you will still be responsible for 2,000 shares. Although penny stocks are typically never big money returns they are a great way to get your feet wet with the stock market and still be able to make a profit, thus providing another reason the stock market seems to be the best way to invest money. However, there are those who also say that the stock market is not the best way to invest money due to the high risks that come with having money tied up in an ever changing stock market. The stock market has been known throughout history to crash, causing investors to be out millions of dollars. Also, there is no real way to know when a crash is coming. While the stock market may be the only investment area you can see your money multiple ten fold in a week it is also the only area you can see your money decrease 10 fold over the course of a day, thus making it seem to not be the best way to invest money. In summary, the stock market is the ultimate high risk/high reward investment. So before you play the stock market the question you have to ask yourself as an investor is do you view the best way to invest money as the safest or as the most profitable possibility?

Now, if you answered the previous question that the best way to invest money is the safest then rather then look to the stock market place your money in real estate investments. The easiest, most common and most profitable way to get involved with real estate investments is by “flipping” houses. In this case people will buy homes that are in foreclosure directly from the mortgage lender. Due to the fact that the lender is not making any money on a house that is not being occupied they will look to fill the house as soon as possible. This allows the investor to be the strong hand in the negotiation process. An investor can purchase the property below market value, sometimes up to 40%, which means that the property already has equity. Now, the investor can turn around and sell the property at full market value and make a profit. It seems so easy that you might think it was illegal. However, there are no laws against “flipping” houses. Also, the reason real estate is a safer way to invest your money is because historically property values do not crash like stock values. For the most part, property values continually increase overtime allowing the investor to make a higher profit when the property is sold. This is especially true in bigger markets such as California, Florida, and New York. For these reasons many people believe that real estate is the best way to invest money. So why would real estate not be the best way to invest money? Well, first off you have to have a lot more capital in hand to be able to start investing in real estate as opposed to the stock market. In essence, there are no penny real estate ventures. Also, while there is an unlimited amount of stocks available there is only a certain amount of real estate available. Finally, real estate investments require more hands on work and usually take longer to account for the same amount of profit that a stock can achieve. It is for these reasons many people believe that real estate is not the best way to invest money.

So what is the best way to invest money? The answer is there is no answer. Everybody has different needs and different wants. Therefore, what investment may be right for one person may not be what’s right for another person. Maybe you want a chance at striking gold quickly no matter what the risk. Maybe you would rather wait a while if it means that your risk is less. Nobody knows but you. So what is the best way to invest money? Well, only you can answer that one.

The Case for Investing in Gold Today

If you’re looking to store wealth in something both rare and secure today, you will find nothing to match GOLD.

Gold always tends to reward cautious savers in times of financial stress, because it is both hard to destroy and tightly supplied.

In short, it is the very opposite of debt.

Gold doesn’t corrode or tarnish, and it’s relatively useless to industry. That’s why almost all of the entire stock of gold mined over the last 4,000 years remains unused today. It exists as either jewelry or bullion, both of which act to store wealth and value.

The world’s total store of gold now stands near 160,000 tonnes. But the metal is so dense that, if formed into a single a cube, it would have an edge barely 22 yards in length.

That wouldn’t even cover a tennis court!

Gold vs. Paper-Money Inflation

New gold is being found and mined today at the rate of some 2,600 tonnes per annum.

That’s a modest increase of 1.6% per year to the above-ground supply. And critically for the value of gold, this annual growth-rate lies beyond the power of politicians or investment banks to increase.

The supply of Euros, in contrast — the most hawkishly-managed major world currency right now — is currently expanding by 11.5% per year.

Thanks to this tight supply, gold grew its purchasing power more than nine times over during the 1970s — the last worldwide surge in inflation. In terms of business assets, it rose 23 times over by the start of 1980 as measured against the Dow Jones Industrial Average.

During the financial collapse of the 1930s — but this time amid a deflation caused by half of all banks in the United States failing — gold bought 17 times as many financial assets as it did before the Great Crash of 1929.

Now debt defaults and inflation are working together today, forcing a fresh crisis in the value of money. Gold has already risen three-fold against the New York stock market since early 2000. It’s recently turned higher in terms of residential and commercial real estate, too.

Time to Buy Gold?

Gold doesn’t care whether a financial collapse destroys the value of money (inflation) or the value of debt (deflation). Its unique characteristics — indestructibility and tight supply — mean its owners can thrive amid either.

But that doesn’t make gold a “forever” investment. Gold will always lose value during stable periods of strong economic growth.

Over the twenty years to 2000, for example, gold lost 95% of its value in terms of US real estate. So it’s no surprise that, as a proportion of world investment portfolios, gold fell from around 2% to effectively zero.

The trend in gold prices finally turned higher at the start of this decade, just as Gordon Brown — now the British prime minister — sold half the UK’s national gold reserves at less than $300 an ounce.

Since then gold has trebled and more. But this gain remains small in the context of previous gold trends. It’s also been limited by Western governments persuading their citizens that “core” inflation in the cost of living is running at just 2% per year or below.

These official CPI figures, of course, exclude the cost of housing, mortgages, taxes, fuel and saving for retirement. But this trick cannot go un-noticed forever.

New Investment in Gold

New gold investment will continue to grow if the world’s major currencies — gold’s main competition as a store of value — plunge into the inflationary spiral that many economists fear.

Until there’s a dramatic change in monetary policy, the over-supply of Dollars, Euros and Yen look set to keep pushing gold prices higher. And it took a dramatic change in central-bank policy to finally kill gold’s last inflation-led surge.

At the start of the 1980s, the Federal Reserve pushed US interest rates up to 18% and above, restoring the world’s confidence in its currency and kick-starting the “long boom” of the next 20 years.

Could America survive such strong medicine now? Would Ben Bernanke even dare risk it?

If you think the world’s central bankers are about to set interest rates far above the real rate of inflation, you should steer well clear of gold.

But if you fear for your savings — and you want to start investing in gold — you can start today, for free, at BullionVault.