Investments to make while you are in your 20s
Most youngsters desire an early retirement from their careers and have a corpus that can help them live a happy life after they reach their 40s. They are willing to work hard while they are young, to create the proverbial nest egg at a much younger age compared to the earlier generations. While there are many avenues of earning money in the current digitized world, if you want to be rich by the time you turn 40, then you need to start saving and investing your money early in life. Today, we will talk about some investments that you can make while you are in your twenties to help you enter your forties as a rich man/woman.
One of the biggest reasons behind most Indians working until late in their lives is the delay in starting their investments. The most common reasons behind this delay are low salaries, complacency due to having time on hand to reach financial goals, and the need to indulge in various high-cost activities. This delay can result in making the process of achieving your financial goals challenging. If you give your money more time to stay invested, it has a better possibility of generating high returns. Here are some investments that you can consider while in your twenties that are known to generate wealth in the long run.
Save more to invest more
When we are young, we want to explore the world, travel to different places, dine at the best restaurants, buy branded clothes, and indulge in things that money can buy. While some youngsters are more responsible with their finances, our twenties are usually filled with fun-filled activities that usually involve spending. Such a lifestyle can have a direct impact on the money you save from your salary and the amount you invest.
The first thing you need to do is create a budget for your monthly costs. Factor in your necessary costs and keep a budget for shopping and parties. However, make sure that you don’t exceed the budget and save a fixed amount every month. This will help you invest in a structured manner. Also, buy a health insurance policy to save taxes and protect yourself against unexpected expenses.
Invest in Real Estate by 25
Real Estate is known as the best asset for wealth generation. It is a unique investment product that offers capital appreciation and regular income at the same time. Real Estate is also the best hedge against inflation. Hence, in a country like India, where prices rise regularly, real estate investments can help generate wealth more consistently than other assets.
When you buy a property, commercial or residential, its market price depends on the demand and supply in the market. In India, the population is increasing rapidly and the demand for homes and offices has been on a rise. Also, as more and more people throng large cities and towns for employment, there is a rise in the demand for rental properties too. If you buy a property at a young age, then you give it enough time to appreciate. In the meanwhile, you can rent your property and earn rent. This income can be used to either repay the home loan or invest in other low-risk instruments that offer good returns.
When inflation rates increase, property prices and rents increase too. Therefore, you have a dual benefit. If you plan it right, then by the time you are 40, you will repay your loan and have a corpus too.
Create an Investment Plan
Whether you decide to invest in real estate, gold, stocks, mutual funds, or any other instruments, it is important to work with an investment plan. There are three core pillars to successful investing:
1. Your financial goals
2. Risk tolerance
3. The time horizon of the investment
Think about your financial goals. What do you want to achieve? Are you investing to create a corpus to buy a house? Or, do you want to create a corpus for early retirement? This will help you choose investments that offer adequate returns. The next thing you must consider is your tolerance for risks. Every investment has some risk associated with it. Usually, instruments with higher risks offer higher potential returns and vice-versa. Make sure that you know the risks you are willing to take so that you don’t panic and make rash decisions about your investments. Based on these two factors, choose the time horizon for which you would have to stay invested.
Remember, investing in your twenties opens up the possibility of becoming rich by the time you reach your forties. However, it is important to plan carefully and be disciplined with your money.
If you are planning to invest in real estate, then make sure that you research the property and/or builder comprehensively. At BramhaCorp, we make projects that people need. Hence, they make for excellent investment properties or residences/offices too. If you are looking to invest in real estate in Pune, then take a look at our BramhaCorp SMART project at New Kalyani Nagar, Pune. With one-of-its-kind studio apartments for modern living, the project is built near the upcoming tech hub in the city – New Kalyani Nagar. If the current trends are any indication, then the demand for properties in this area will surge and BramhaCorp SMART can put you in a great position to profit from this increase in demand. You work hard for your money, make wise investment decisions, and allow your money to work harder for you!