The global financial debacle that continues to fester appears to have taught us at least one thing: it makes little sense to place all your money in speculative investments. Where should one therefore invest? What should be the focus? Well, let's get back to basics shall we? Let's focus on simple cash flow investments.
Let's use the 2008 US economic crisis as an example. The ramifications were felt worldwide and to this day, many economies are yet to bob their head above water; let alone find the ability to float above in order to begin the long road to recovery. One of the primary roots of this crisis was the US property market which was a bubble waiting to burst; and burst it did.
So for those looking to safely invest their money to safeguard against high inflation rates, taxes and potential market pitfalls, cash flow investments like the stock market appear to make far greater sense. Most blue chip investments yield a fixed rate of income via its dividends - this is assured income. Additionally, most market upheavals tend to have far less an impact in comparison to a large speculative investment where money can be lost in rate rises etc.
It may also be wise to look beyond your own economy for cash flow investment income. An economy like Australia for example seems to have dealt with the economic crisis well and has potential in various sectors for growth. What more than a stable economy that shows clear signs of growth?
While an element of attention must always be placed on speculative investments, emphasis on building your foundation should ultimately lie with cash flow investments. Although the rate of return on investment may not be astronomical, the return may in actual fact become assured and this is a great way to safely build your net worth. As you become more confident with your investments and begin to learn more about the trends of the market though, you can certainly start to have more control by blending your simple cash flow investments with other speculative investments. The overall element of risk can essentially be determined by you!
So, simple investments equal simple returns. Simple, yet assured returns. Sounds simple doesn't it? Perhaps that's the problem we face today. Not enough simplicity is applied to our increasing demands for sustainability and comfort. We seem to have complicated our lives to the extent that economies worldwide are now at breaking point. If we stick to the basics though and focus on a simple cash flow, we will enjoy our investments and enjoy the success of investing!
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