Having a strategy is the key.
Before making your savings profitable, it is important to examine your financial and personal situation. Modifying habits, changing things we don’t like about how we manage money, or setting new goals are necessary aspects to consider before hiring investment products. We must also know how tolerant we are of taking risks.
Once it is clear how the financial situation is, it is time to draw up a plan and define a savings investment strategy. But where do you start?
💶 Set a roadmap
Considering that you already know clearly what your personal financial picture is, you must decide how much money you want to make profitable and for how long. For example, suppose you have 30,000 euros.
In that case, if you are not very experienced in investment in securities and have a conservative risk profile, it may be worth keeping the money in a 2-year fixed-term deposit. These are easy-to-understand financial products that today make a return of up to 2.70% APR (at 24 months) and guarantee an investment of up to 100,000 euros per person and entity.
💶 Don’t invest everything
You should never invest all the money saved and neither the one that will be needed in a short time. The other golden rule of finance is always to have an emergency fund available for any unforeseen event that may arise.
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💶 Look for checking accounts that make money profitable
Another way to put money to work is to deposit it in interest-bearing accounts. This financial product is a sight account that pays interest on the money deposited. Two types of accounts coexist in the market that offers profitability:
- On the one hand, remunerated current accounts for day-to-day use with which you can make transfers, pay for purchases with a card, receive your salary, etc.
- On the other, savings accounts have practically the same characteristics as current accounts but are designed to promote savings.
Both allow available cash and offer up to 5% remuneration. Of course, some limit the maximum balance that they make profits.
💶 Study before investing in complex products
If you tolerate the risk of loss or want to Money Profitable in more complex products, the first thing to do is Study. In other words, understand what you will invest in, what risks you run, how volatile the product is, and how the market is doing. The worst mistake you can make is risking your life savings on a product you don’t understand.
Currently, some entities offer a service known as Robo advisors or automated investment managers. These tools help choose the best investment fund portfolios according to the client’s preferences and profiles. These robotic advisors evaluate risk tolerance and propose a diversified portfolio that suits the client’s goal.
Beware of commissions
It is of little use to put money to work if, in the end, you end up paying large sums as commissions. Before contracting a fixed-term deposit, a Robo advisor, or any other product, it is essential to read the small print carefully and discover the commissions that must be paid.
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