Investing is about making your money work for you. For many of you in the latter part of 2008 and the first six and a half months of 2009 are months when you try to recover the money you’ve worked so hard to get, rather than rebuild your partimoine.
Many people in the financial sector have been no doubt tell you not to panic. The economy is cyclical. it will reverse over time and you will receive the money you lost. Look at the tables and graphs. They do not lie. There have always been ups and downs of cycles and recovery has always taken place. Holding the line, you will probably get back to where you were. However, what will happen to you and help you get where you have been through the months lost to the recession and recovery?
Loyalty to his financial planner, broker or banker is admirable. However, what would you do if you had a job where every payday from your employer to say he could not pay you and asked you to continue working on the hope that one day you will receive all money that is owed to you for the work? You must be able to stay in your comfort zone and so you need to be proactive if it is your job or your investments. Working for someone who does not pay or have investments that are losing money is not acceptable, especially when there are safe alternatives available.
Corrective action for the issue of employment is very simple. You change employers. However, alternatives to the issue of investment may not be so easy. What is a safe investment? The best way to illustrate the answer is through an example:
You buy a good income and pay cash for it. You will find a tenant who will take care of the property, has an excellent income and signs a long term lease. You do your due diligence and the tenant is financially sound and has an impeccable character. The customer is moving and you collect the rent. Because you do not have a mortgage and the tenant pays utilities, taxes and general maintenance of the property you are able to put the net rent from the bank and then use it to invest more and yet the composition of your return.
Are there risks in the investment? All investments carry some risk. The strength of the tenant in the example above shows the risk is minimal. However, all people can afford to buy property income and pay cash for it.