The world's super-rich come from a variety of backgrounds, with most of them having started with little or no money at all. The key insight, however, is that these billionaires knew where and how to invest, and this knowledge is what we share with you with this article.
When it comes to investing right, billionaires know exactly how and where to invest. If you aspire to create wealth like them, here are some key points to integrate into your investing practices.
Warren Buffett needs no introduction. He is the world’s richest investor and the third richest person in the world. He once said, “Never depend on a single income. Make investments to create a second source.” Buffett grew his wealth by winning the stock market consistently for over half a century. But that’s only part of the reason he became successful.
What really helped him get sky-high returns was his interest in the insurance business. Buffett started purchasing insurance companies and once he succeeded there, he had access to a huge capital that he later invested carefully into A-grade companies.
Although we cannot really follow in his footsteps, we can invest heavily in financial assets like Mutual Funds
, professionally managed investment funds that pool money from many investors to purchase securities like stocks, bonds, money market instruments, and other assets. The income/gains generated from this collective investment is distributed proportionately amongst the investors after deducting certain expenses.
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This is one of the most popular financial plans in which people invest their money. Many people prefer bank Fixed Deposits (FDs) since they are considered safe. The return earned from an FD is fixed and known at the time of investing unlike in case of equity.
Recurring Deposits (RDs)
provide you the flexibility to invest an amount of your choice per month. This deposit helps you earn decent interest on the invested amount. In short, it is similar to making fixed deposits of a certain amount in monthly installments.
Before entering politics, US President Donald Trump was a businessman and television personality. His numerous real estate holdings are by far the most lucrative aspects of his career. As a businessman, he found numerous ways to make money in real estate and took several steps to diversify his investment portfolio. In the long run, this translated into many real estate properties, ranging from multi-family homes, housing developments and even golf courses.
According to Business Insider, Donald Trump believes that the best choice for investing is still equities and corporate bonds. He suggests demanding good interest rates and long-term financing, presumably so you can make the most of leverage.
But, if you want to reap financial rewards in the future, there’s nothing like investing in real estate. Real estate investments not only provide a steady flow of cash in the form of rental income, but also help save income tax. However, remember that location is the key to smart real estate investing. Depending on the location, you could be earning a significant income to cover your expenses. It will also help you make extra money on the side.
As per studies, the rich in India find this the safest option to grow their wealth.
An American businessman, investor and philanthropist, Carl Icahn said, “My investment philosophy, generally, with exceptions, is to buy something when no one wants it.”
While Buffett is widely recognized as the best investor in the world, Icahn actually has the best track record in history. Icahn is an active investor who takes big stakes in deeply undervalued value stocks, pushes for change and then exits for, many times, huge profits. Recently, Icahn has made billions on his active positions in Netflix and Apple.
In investing, you need an edge to make outsized returns. So take inspiration from the billionaires and grow your wealth to your fullest potential, in order to live a luxury life. With planning and good market knowledge, one can get handsome returns in stock trading. While timing the market is generally difficult, try to recognize good buying opportunities when you see them. Instead of panicking when stocks fall, jump at the chance to buy more of your favourite stocks at a discount.
Most billionaires know that the only assured way to make money in stocks is to hold the investments for a longer time and to let the market's natural upward bias work its magic. So, ensure you study the market well, and learn the billionaire’s way of trading in stocks.
Gold is one of the most favourite investment options among wealthy Indians. Apart from class and prestige, high liquidity and inflation-beating capacity make gold investment the safest option among the rich. Although the price of gold can be volatile in the short term, it has always maintained its value over the long term.
There are many such plans, that can help you grow your wealth. By choosing the best investment option, you will not only be able to create a financial cushion for yourself but will also attain financial security to live a secured life.
However, one thing you need to remember is that there are no such investment options that offer high returns with low risk. Returns and risk are directly proportional to each other. So, higher the risk – higher the returns and vice-versa. So, before you decide on any investment option, ensure you check the risk associated with your product. You can even take the help of an experienced financial advisor to maximize your earning potential.
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