Why Invest? The Best Investment Options for 2024
Investing offers numerous benefits, including an additional income source, a robust retirement fund, and enhanced wealth growth. By investing, you can achieve your financial goals and increase the value of your capital over the long run. If you have recently sold a property or received an inheritance, investing is a smart way to make your money work harder for you.
One of the key points to consider is investing comes with risks. It is essential to balance potential gains with these risks and ensure you have manageable debt levels, an emergency fund (3-6 months expenditure), and the ability to withstand any market fluctuations without needing to access your invested funds.
Top Investment Options for 2024
Here are the best investments to consider in 2024 covering all different types of risk profile:
High-yield Savings Accounts
Overview: Earn interest on cash balances, accessible anytime.
Ideal for: Risk-averse investors needing near-term cash access.
Risks and Rewards: Low risk, moderate returns.
Long-term Certificates of Deposit (CDs):
Overview: Higher interest rates than savings accounts, ideal when expecting lower future rates.
Ideal for: People who require income and those who can lock up funds for extended periods.
Risks and Rewards: Low risk, slightly higher returns than savings accounts.
Long-term Corporate Bond Funds:
Overview: Bonds issued by corporations. Diversified with a number of different ones
Ideal for: Investors seeking steady cash flow and lower portfolio risk. Good way to diversify.
Risks and Rewards: Moderate risk, higher returns than government bonds. Risk reduced the more diversification.
Dividend Stocks:
Overview: Stocks that pay out a dividend to investors
Ideal for: Investors seeking income and long-term investment.
Risks and Rewards: The risk can vary depending on the stock.
Value Stocks:
Overview: Invest in undervalued stocks - these tend to do better in periods of high inflation.
Ideal for: Investors who want to invest within the stock market and are comfortable with some risk
Risks and Rewards: Risk can vary, Upper-Medium
Small-cap Stocks:
Overview: Stocks of small companies with strong growth prospects.
Ideal for: In a diversified portfolio. Investors looking to take more risk
Risks and Rewards: High risk but have the potential for higher returns.
REIT Index Funds:
Overview: Real estate investment trusts with diversified real estate exposure.
Ideal for: Income-focused investors seeking real estate without property management hassles.
Risks and Rewards: Moderate to high risk, steady dividends, potential for capital appreciation.
S&P 500 Index Funds:
Overview: Based on the 500 largest American companies.
Ideal for: Investors looking to diversify and track the market.
Risks and Rewards: Moderate risk, and good upside potential. It has achieved over 10% per annum in the last 50 years
Nasdaq-100 Index Funds:
Overview: Based on the 100 largest tech companies.
Ideal for: Investors looking to take more of a growth approach.
Risks and Rewards: Higher risk so subject to more volatility
Rental Housing:
Overview: Investing in BTL properties.
Ideal for: Long term Investors looking to generate passive income.
Risks and Rewards: High risk, potential for regular cash flow and appreciation. Comes with other issues such as tenants not paying, hidden costs etc.
Key Considerations for Investing
When choosing the best investment options, consider:
Risk Tolerance: What is your risk profile?
Time Horizon: When do you need to access to the money?
Investment Knowledge: How well do you understand the market that you are investing in?
Investment Amount: What value are you looking to invest?
By understanding these factors and choosing the right investment options, you can effectively grow your wealth and achieve your financial goals in 2024. A financial adviser can guide you through the best option for your situation.
For more information and personalised advice, book a one on one meeting with one of our financial experts today. Book in now to speak with an adviser
Disclaimer: This blog post is for informational purposes and should not be considered financial advice. Always consult a financial adviser for personalised guidance.
