Benefits of Investing For Your Financial Future

If your monthly income is only spent on daily needs, then one way to increase your wealth is to be very clever to take advantage of unexpected additional income or a bonus from the company. Because that’s when you have more money that can be saved. Then, how to use that money was not finished with it? Probably the first thought is to store them in a bank savings or deposit, and you have appointed themselves to not be using the savings. In fact, one of another instrument that is worth mentioning is the investment.

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Not many people know the benefits of investment in the future. However, did you still may use the money for unexpected needs, such as for the cost of a hospital or other. However, besides that, it’s worth your monthly income is also set aside for savings, for example, 70% of daily needs and 30% for savings. In addition to saving money in bank savings, you can invest your money.

 

Although many ordinary people who think that investing is a high risk that it will eliminate your money, but in fact, if executed properly, the investment actually helps in doubling your money. In fact, that is not known by the majority of the savings bank interest rate per year is very small. It would reduce the value of your savings because it eroded by inflation rates that increase each year far above the interest given by your savings. To invest, investment must be selected must be long-term. Therefore, the real benefits of this investment are very important and have the potential to increase your wealth and your family in the future. Through the right investment, you will benefit many times in the future. For this reason, many people began to shift savings into investments. So, what the hell, the benefits of investment? Here are some of the profits earned through investments.

Protect your money or assets from rising inflation

Inflation always happens every year everywhere, the data show that in 2013 the inflation rate in Indonesia reached 8.38%. Meanwhile, in the last five years (2009-2014), the inflation rate in Indonesia reached 29.52%. Therefore, if you do not keep your money in the investment, then your money will be eroded in value by inflation rates. A concrete example of this inflation is that if in the 2000s you could buy two pieces of fried with money, 1,000, then in 2014 it was 1,000 of your money could only buy one piece of fried. The amount of money you keep, but weakened the purchasing power of your money. That’s why you need to save money in an investment. The value of the money you save on investment will increase in accordance with rising inflation because the value of an investment will also increase along with the rise in inflation itself. In the meantime, if you keep money in a savings account, its value could be eroded due to inflation. Therefore, the interest rate provided each year from banks will never increase even though inflation is very high. Thus, when the prices of basic necessities have risen significantly, the amount of your savings increased only slightly, not enough to offset rising inflation.