If we had our way, we would most probably find ourselves spending like crazy on anything we see and want to own. But the reality is we need cash and finances to make it happen and while we can work our way to buying and spending a lot, we just have to be practical that we simply cannot have it all. We need to get the balance right between spending and investing.

So if you can’t earn enough from your job to keep you in the lifestyle you desire, what are your options? You may have considered whether you should  invest in the stock market. Letting your money work for you is an attractive option. But you should only invest with money that don’t need for necessities. Make sure you set a budget and allocate money first to essentials like rent, loan payments, utilities and food.

If you have covered all your bills then you could consider investments for long term passive income. Just make sure you are spending at the right time to control your finances. You should only invest with money that wouldn’t leave you in a dire straits if you lost it all. We covered this in a previous article on Forex trading for beginners. Another option would be to invest in stocks and shares.

Of course, determining where you will invest begins with researching the available types of investments, determining your risk tolerance, and determining your investment style — along with your financial goals.

spending vs investing chart

Researching stock market investments

If you were going to purchase a new car, you would do quite a bit of research before making a final decision and a purchase. You would never consider purchasing a car that you had not fully looked over and taken for a test drive. Investing works much the same way.

You will of course learn as much about the investment as possible and would want to see how past investors have done with that particular investment. Learning about the stock market and investments can take a lot of time, but it is of course time well spent. There are numerous books and websites on the topic. With access to the internet, you can actually play the stock market — with demo money — to get a feel for how it works.

You can make pretend investments, and see how they do. Do a search with any search engine for ‘Stock Market Games’ or ‘Stock Market Simulations’. This is a great way to start learning about investing in the stock market.

Other types of investments exist outside the stock market, however, they do not have simulators. You must learn about those types of investments the hard way, by researching and reading.

As a potential investor, you should read anything you can get your hands on about investing but start with the beginning investment books and websites first. Otherwise, you will quickly find that you are lost.

The first investment you should make is in your educationClick To Tweet.

Finally, speak with a financial planner. Tell them your goals, and ask them for their suggestions. I mean that is their job. A good financial planner can easily help you determine where to invest your funds and help you set up a plan to reach all of your financial goals.

Worldwide investing

The opportunities for stock investment is not only limited to the stock markets of your home country. With the increasingly easier access to foreign economies, buying shares of international companies is now a practical option you can consider as part of diversifying your portfolio. It is also an opportunity to take part in booming economies and faster-growing stock markets.

Like any other investment venture, investing abroad has its own set of benefits and risks. The key is to consider the pros and cons and evaluate if this fits your risk tolerance as an investor. Most investors who venture beyond their home countries are high net worth individuals who have a fund surplus after investing in local stocks, bonds, mutual funds, real estate, etc. Buying foreign shares is not limited to rich investors though. You can start with just $500 and build from there if you later decide that international stock markets suit your portfolio.


banknotes for spending and investing

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