Knowing how to valorise your finances is an important skill. In order to value your money, you first need to know where to put it. Check out the basics of financial literacy so you know how to preserve the value of money.
Why should people know how to value money?
Finances are fleeting. They change their value over time. That’s why people should be aware of ways to protect their money from inflation.
The assets that perform best when prices rise are those that will bring in more cash or increase in value as inflation increases. Examples include rental property subject to periodic rent increases or utility rates tied to rising price levels.
How to make money appreciate?
There are several ways to preserve the value of finances. We’ll look at these on the fly, but if you’re serious about investing and want guaranteed success, you’ll need to study this a little more closely.
1. Invest in shares
Those who trade on the stock market can buy a share of a company’s stock, which is a share of the company’s profits, or dividend. To get started, it is worth reading the czech book “Becoming an Investor”, subtitled How to Master the Creative Magic of the Stock Market, where the author explains everything.
2. Invest in gold
Buy gold bars. You can also go into other precious metals (such as silver). Depending on the size of your investment bullion, number of coins or bars, store gold at home (a smaller supply of the metal), in banks’ safe deposit boxes or in non-bank vaults for a yearly fee. If you are investing several million crowns, gold can sometimes be stored in a dealer’s warehouse.
💡 Tip: If you don’t want to store your gold anywhere, try CFD trading, ETFs or options, where you don’t have to deal with any receiving, storing and shipping.
3. Invest in housing
Spend money on building materials and equipment. You don’t have to buy anything abstract, as with securities, but use your money straight away to renovate your house or flat. As a rule, the value of the home will increase and you will make a profit on this investment if you sell or rent it out.
4. Buy land
If you become the owner of a building, agricultural or water area, it can also earn you some money. How about buying a hotel by the river? You can rake in a lot of capital for mooring boats on your land. Become an entrepreneur and employ cooks, waiters, maids and other people there. Also have a gas station on the water for refueling the boats that dock at your place. Organise events, yacht races and similar activities for guests. Equip your establishment with a gym and the surrounding area with a sports field, of course. The money you invest will then be returned to you in a much greater extent.
You can also set up a car park and collect fees. In the city or at your hotel, there will definitely be a use for it. You can also make money by setting up a truck parking lot.
You can lease out the fields to farmers and have a monthly inflow of money. Another option is to make beds and grow vegetables there. Who wouldn’t want to have their own ingredients without chemicals and with a big dose of vitamins? If you live in the city, you can buy a garden and do your growing there. Beautiful fragrant flowers and something good for your stomach will surely be welcome. Money spent in this way will bring something positive and beneficial.
5. Cryptocurrencies for the brave
Bitcoin and cryptocurrencies have been very much discussed lately and are interesting from a financial point of view because they offer the possibility of big earnings as well as big losses. By their very nature, they are deflationary currencies, but instead of inflation risk, they are highly volatile assets and therefore may not be for everyone.
6. Beware of savings accounts or building Savings Accounts
Building Savings Accounts have the advantage of being government backed, so you will have some money coming in from them on a regular basis. If you supply the bank with your money, it rewards you with interest in return.
However, always make sure that the interest and contributions are higher than inflation. Otherwise, this money will do only slightly less badly than your current account assets.
Invest in what you understand
Get a thorough explanation from an expert or someone you know who is knowledgeable. Borrow books on investing from the library and read online articles on how to successfully make money.