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Creating a residual income isn't only about having an
idea a service or a product which someone will pay you money for you can
also (in the long term!) cleverly, save money for the future, and with
the correct interest rate it can add up to a massive amount! As were
talking about getting rich slowly by creating multiple sources of
residual income its also good to know how to grow that money over the
long term so you could potentially retire early!
There are many books and websites on the subject of
investing, and where is the best place to put your money. Some of these
offer good independent advice with a no nonsense approach
www.fool.co.uk and others will
baffle you with jargon trying to get you to buy one of their products or
one of the products which they will make the most commission on! Here I
will try and give some basic information on where is available to save
your money and point you in the direction of some great websites!
A few Options!
So you may be wondering where is the best place to
put your money? I personally am in no position to answer that but I can
describe what is available.
High Interest ISA (Individual Savings Account)
This is probably the safest option as you what you pay in you will get
back, plus the interest. Best of all you don't pay any tax on the
interest you have made!
ISA Index Trackers
A savings account which tracks the stock market index of your choice
this should be viewed as a long term savings plan. The rewards can be
better than a savings account but the risks are that you may not get
back what you originally invested! As the value of your account can move
up as well as down inline with the performance of the Stock market
index! Historically on average this has proved around 13% increase per
year for a 20 year period, but there still is that risk factor!
Premium Bonds
Premium bonds are a great place to put your money if your not
bothered about receiving interest but would like the chance of winning
some money! Each premium bond you buy you get a number, like a lottery,
and these numbers are drawn each month. If your number gets drawn you
could win a prize of between £50 and £1,000,000. Best of all you can
sell your premium bonds back to the government and get back the original
money you put in! Stocks & Shares
Stocks and shares can be quite risky so these must be handled with
caution, what you are in effect doing is buying a tiny small piece of a
company. If people think the company is getting better at its job your
tiny piece will increase in value, and go down if people think the
company isn't performing. All can really say about this is educate
yourself! I cant recommend this book enough The Naked Trader it cuts
through the jargon in a no nonsense entertaining approach!
Property
If you buy a house and keep paying off your mortgage each month you
are in effect making an investment each month. It may feel like
you are constantly paying the interest but in the long term it is
generally agreed to be a sound investment. If your £100,000 house
quadruples in price in 20 years and your mortgage plus interest only
came to £240,000 over those 20 years, you have made a smart move paying
£240,000 for a £400,000 house! It can be risky as it is only speculation
that this will happen in the future just because it has happened in the
past. At the time of writing Jan 2007 it is uncertain that the house
prices will continue to rise at the speed they have for the past 5 year
or drop a little to let the economy catch up.
Alternative Investments
These can range from may things such as old first edition comics,
autographed pictures, paintings, cars, antiques. This is more of a black
art than a science, you are speculating that something you buy now will
be worth considerably more in the future. It is quite risky so I
wouldn't rely on alternative investments for an early retirement! But by
all means if you are an avid collector, carry on! You just never know!
This is intended to be just a general guide,
please click on the menu to the left for more detail on some of these
subjects!
Avoid this! If you do a Google search for investing or making
money you will inevitably get loads of links for sites offering to
double your money within 6 month, or how to play the stock market using
our amazing system where you pay £4,000 for a piece of software which
will turn your savings of £5000 into £90,000 within 10 months!
TAKE NO NOTICE!!!!!
These systems do not work! As with everything figures can be manipulated
to show you the best possible outcome but they only tell you the bad
points in the tiniest print hidden somewhere. what these adverts should
say is this:
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The New Moneybox 2000
Intelligent money system
We will give you access to our severs which
will allow you to use our special program that automatically trade
shares for you!
This may or may not work! but we have tested it with monopoly money
and the best figure we came up with was turning £5 into £90! So we
thought if it can do it with a fiver we could do it with £5000. That
was of course after using risky techniques and running the program
on the best possible day of over 100 years of trading statistics.
The worst we have done was put £1000 pound of monopoly money into
the program and we ended up owing our creditors £10,000, we then had
to draw a card and were told that we had to go straight to jail and
went allowed to pass go or collect our £200.
So for a bargain price
of £4000 for the software, and another £5000 to trade with that's
only £9000 we can offer you a round a 0.1% chance of making you
rich! As for the other 99.9% don't worry because we don't!
The moneybox team! |
You may think this is a little far fetched, but
believe me if these systems could turn £5,000 into £90,000 in under a
year, and they had confidence in their ability to that. They would then
re-mortgage their £200,000 house and turn that money into £3,600,000 and
live off the interest! So if they're not prepared to do it with their
own money why should you give them yours!.
So to sum it up, if an offer sounds too good to be
true, then it probably is!
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