2017 may be relatively over, but it’s about time to start working on making profitable investments in the new year. Every great feat is achieved through the aid of a workable and realistic plan. The same goes for investing. We will be exploring what should be done to have a waterproof plan for investing money when the new year arrives.
There are so many opportunities to tap into in 2018. It would be a shame to see the year go and make zero effort to invest funds and generate passive income.
How to Invest Funds in the New Year
Here are six things to do when creating your investment plan for 2018:
- Profile Yourself: What kind of investor are you? Answering this question truthfully is the first step in creating a plan. It would help in understanding yourself and to build accordingly. Now, there are three types of investors as there are three kinds of investments. The first kind of investor is a low-risk investor who prefers to put their money into ventures with a minimal amount of risk which have a long-term return pattern. Then there is the medium risk kind of investor who makes a balance between investing in high and low risks assets. Finally, we have the high-risk investor who will put their money where their mouth is. They are not afraid of losing even when their big bucks are involved, hence they usually cash out the highest returns. Of these three kinds of investors, where do you find yourself? Let me know in the comments.
- Set a Target: Every plan has a target to meet. The same applies here as well. What to keep topmost in mind is that your target must be realistic. You should not set a target which you have an intent to meet in one year but actually takes longer than that. So, in 2018, how much do you want to make monthly as passive income from your investments? Make a note of that.
- Know your Options: Now, when it comes to investing in Nigeria, there are multiple options to consider, even for a low entry. With as little as N5000, one can make an investment in some of these options and get a return in as quickly as one month, whereas there are others that may take longer. As we said earlier, your target and who you are as an investor will determine the option that works best for you. Also, how long are you willing to wait? Aside from investing your money, you are also indirectly investing your waiting time. Let’s do a quick rundown of investment vehicles to consider in the new year:
- Bitcoin and cryptocurrency: Bitcoin is a high-risk investment channel that is yielding interests as much as 5000% value in a short period of time. Little wonder a lot of investors think it is a bubble and do not want to invest their hard earned cash into it. But if you are all about making the big bucks and have little concern for risks, this is the way to go. You can get started using this site.
- Agriculture: Agriculture is still the mainstay of the Nigerian economy. With platforms like Farmcrowdy and ThriveAgric, you too can invest in Agric, contributing your own quote to improving the value chain while smiling to the bank every month.
- Mutual funds: A mutual fund is a low-risk investment vehicle which doesn’t require much, to begin with. It is for the investor who is scared of losses and also for him/her who doesn’t have so much to invest. To read more about mutual funds, check this out.
- Real Estate: There are square miles of land waiting to be bought! Although real estate does take a lot to invest in, the dividends are worth it. With a population of over 200 million, more people are moving to the urban centres and need a place to live, work, and play. This is a real estate problem waiting for investors to solve. There are a good number of real estate consulting firms that help with this. Some of them are Propertylink Real Estate Investment Limited, Cappa D’Alberto, Elegant Court, Whitebricks among others.
- Renewable energy: In 2017, it is unfortunate that power supply is still a major issue bedevilling the Nigerian populace and affecting the economic viability of the State. However, this presents a ripened solution for the wise investor. Although capital intensive, investing in generating power from a renewable energy source like the sun has tremendous benefits. The Nigerian government is open to investors and businesses in this sector.
- Set up an Investment Portfolio: When you’re creating your investment portfolio, the first thing to take note of is to start with what you are most comfortable with. Start with the easy stuff which may not demand a lot of your attention. As you achieve some success and get more confident, you can start to diversify your portfolio and add investment options from other industries. What matters is that you start!
- Keep a Watchful Eye on your Investments: In many cases, small-scale investors who put in as much as N5m of funds are not able to hire a financial advisor who will watch the performance of the funds. Therefore, they have to do it by themselves. You must dedicate time every day to be in the loop and be aware of any changes that may affect your investments, especially in the money market. Watch your investments like a hawk!
- Be consistent: This is my final advice for beginner investors. Now that you have started, ensure to keep ‘making money moves’. Consistently put some money into your portfolio, no matter how small, on a regular basis – daily, weekly, monthly, quarterly. No matter what happens, don’t stop.
If you have been putting off investing, after reading this article, I’m sure you really have no excuse. In fact, start now! According to Investopedia
, If you do not start saving until 45, you will need to save three times as much as if you start at 25. The same applies to investing.
Let’s make this money in 2018. Shall we?