You begin (or at least try) to save money for future right from the day you receive your first salary. And then, once you have saved enough to make an investment, you. Are often left confused as to what will be the best investment. Well, it seems to be a frequently asked question among the working class. There are so many options to choose from for an investment. The big tug of war will be between stock markets and property investments. It is a difficult question to answer in general. But depending on the type of investment you want to make and your further preferences, you will certainly be able to make the right choice for yourself. As a step towards solving the question, let’s understand the differences between the two types of investments.
The Real Estate Dilemma
- Real estate investments are more physically tangible investments. You can actually see, manage or maintain the property in which you will invest. They are solid in terms that the price of a price of land or a building will increase over time. These prices are directly to factors such as location of the property, whether rural or urban, and the utility of the land or building.
- Residential units, warehouses and office spaces in urban areas never loose their charm. In fact, an investment in any of the above mentioned buildings will definitely profit you in the long run. The nearness to airports,railways stations, cities etc also play a role in determining the value of lands.
- However, these type of investments are often for the long term. They cannot be easily liquefied. Rather, property is an investment for people who need security in life. So if you are looking for permanent investments, property may be the right choice for you.
Is the stock market any good?
- Stock markets on the other hand are an easily liquefiable investment. The shares you hold can be sold anytime you want. It doesn’t take years or months of waiting for the sale to happen. They +an also be easily reallocated to some other account, for example, a retirement fund, that too free of taxes until you start to withdraw the amount. Sure, it needs a knack and certain understanding of the market. Without this knowledge and experience, you may find it hard to differentiate the right stock from the pile. But, when done well, stock market can double your investments in the minimum period of time and thus double your savings.
- Here comes the risk factor involved with stock market. Just as there is the probability that your money will be doubled, there is also the chance of loosing it. Stock markets are most of the time predictable but when sudden changes happen, no one can possible be sure of the turn it may take. So far portable stocks may face a down fall in worth or vice versa. Thus, while it is almost like having money at hand, stock market is a game for those who are familiar with the tricks.