Tuesday, May 26, 2015

Types of Investments

The average person will agree that when it comes to finances, they don't think of themselves as very knowledgeable, especially when it pertains to investments. This is probably why most of these individuals will take their business to someone with enough knowledge to turn their nest egg into something they can be proud of. Unless you are in the business of investing when someone mentions the word Forex, there is a good chance that you will think they are speaking a foreign language. The fact of the matter is that Forex is considered by many as an important part of investing, the only difference is that this kind of investment deals in foreign exchange.

Market Jitters- Stock Market
When it comes to planning for the future, the stock market is probably one of the better-known platforms for putting it in gear. When a company chooses to offer itself up to investors, it is usually handled through arenas like wall street. Some of the more familiar tools used to trade are classed as common or preferred stock. The difference is relatively simple; preferred stock will put you at a higher risk of loss, but the income potential is greater. On the other hand, common stocks bear less of a risk and are generally based on how well the company is doing. The earning capability will depend solely on the success of the company involved.

Real Estate
When you hear the term real estate, the first thing that comes to mind is a piece of property to call your own. That property could be for business or personal use. When you are planning for your future investments in real estate should be taken very seriously, especially since they can turn around and help you increase your cash flow. There are many advantages to consider investing in real estate, and they include the ability to use depreciation as a tax write off. Then there is the matter of the property value increasing when you hold on to it for a while. There is very little risk involved and a great deal of investment potential.

If you are not inclined to put a whole lot of faith in the stock market, then gold will more than likely be something you think about. The historical value that sticks with gold is unfathomable, especially since it continues to be one of the leading sources for investors. Unlike so many other investments, gold has not lost any of its punch, so when currencies devalue where you live or in someone else's Forex, your portfolio will continue to be strong with gold. If you were to compare the performance of gold to most other investments the thing that glitters will come out on top every time.

Mutual Funds
Investors can still invest in common stocks on the stock market and place a reasonable amount of their money in mutual funds. This will give them the opportunity to diversify some of their assets and lower their stress level. Other than the fact that mutual funds may be thought of as safer, the investor has the potential to get in on the ground floor with smaller investments. It is important to remember that every investor is at risk of losing something, but mutual funds may be a lot more predictable as far as the direction they are heading. When the dust settles, investments are all about your nest egg, which is why it is in your best interest to seek professional advice.

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Saturday, May 9, 2015

Four Things You Need to Know About Angel Investors

Like Money from Heaven

Angel investors are people who have some money to invest and choose to provide capital for an entrepreneur just beginning a new business. In return, the angel investor receives ownership equity or convertible debt. As Robert Bratt will tell you, some of today’s biggest companies started small with an angel investor. 

Not Only for Millionaires
The term angel investor was coined to describe people who invested in Broadway shows, but today it refers to anyone who invests in an entrepreneurial company. One of the reasons people are attracted to angel investing is because the returns can be much higher than traditional investing, but the main reason is because they want to help an individual. However, most angels are not millionaires. They are medium to high income earners who are looking for the next big thing. This means there may be people you know who would be willing to invest in your start-up. 

Not Venture Capitalists
Angels are the opposite of venture capitalists because they are investing their own money in the start-up and not someone else’s. Some angels are former entrepreneurs who got help from an angel and want to give that opportunity to someone else. Angels also give more favorable terms than other lenders because their aim is to help. Often an entrepreneur can find an angel among their family members and friends. 

Angels You Know and Angels You Don’t Know

There are two types of angel investors. One type is the person you know as already mentioned. The other type is someone you don’t know, and you find through an organization or list of angel investors. Before choosing an angel you don’t know, you need to make sure what the terms are. This is not just the terms of the loan but other things such as what percentage of your business are you giving in equity, and can they fire you.

Some Tips When Meeting an Angel

• Don’t offer too much equity in the beginning. You may be tempted to give a higher percentage of your company to get more money, but this should be avoided because it is not good long-term strategy. 

• Be very fluent in your financials. Investors want to see that you know the ins and outs of your money, and how you plan to make a profit.

• Include a salary for yourself in your calculations. Angels expect you to do this because it shows that you respect yourself. If you can’t take a salary some months because of other expenses, you should keep track of how much you earn, and take your salary as soon as you can. 

Whether it is an angel you know or not, angel investing is an excellent way to either get your business off the ground, or take your already successful fledgling business to the next level.
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