Why Invest

What you will learn in this post:

  • How investing makes your money work for you
  • How investing protects your money by beating inflation
  • How investing makes your financial goals easier to achieve
  • How investing helps you build a retirement pot

 

Make your money work for you

They are two ways to make money; either you work for your money, or you money works for you.

Instead of saving all your cash in a bank account that offers below inflation interest rates and eats it up in charges; you can make more money or watch it grow by investing it wisely. Like all things, investing won’t bring large returns overnight but over the long term it can become a gift that does not stop giving.

A good example is shown below; investing UGX 100,000 in DFCU Shares would make you 31% more than putting the money in a savings account.

DFCU Shares will make you more money than saving in the bank

 

Beat Inflation

If you put keep all your hard-earned money in cash, it will be eaten away by inflation, and it will buy you less tomorrow than today. For this reason, it is essential that you make your money grow so that you can save it from being devoured by inflation.

A good example is shown below; investing in a 1 Year Treasury Bill each will produce a greater return than inflation.

Uganda: 1 Yr Treasury Bill continuously beats inflation

Makes financial goals easier to achieve

We all have goals in life, and some definitely involve money – buying a car, building a house, further education or financial freedom.

While investing might mean you won’t be able to spend money right now, but by investing now you will be able to meet your target quicker.

Investing with patience, research and time can help you achieve your goals/dreams faster.

The earlier you start investing, the faster these dreams come true.

 

Build a retirement pot

If you choose not to invest, you may lose money to inflation and may have no money for retirement – do you need any more reason to invest?!

Retirement is a time to enjoy fruits of your hard work not penny-pinching and saving, and it starts by investing now.

For this reason, it is wise to put your money to work so that when you retire you have a good pot of money to enjoy your later years and leave an inheritance to your children.

 

Summary

They are  many more reasons to start investing and depends on your situation. These four reasons show you why investing can make you more money, protect your money, achieve your dreams and enjoy the fruits of your hard work for longer.

Before you start investing, always educate yourself, research and analyse the investments you want make.

“An investment in knowledge pays the best interest.” – Benjamin Franklin

MoneyinAfrica.com provides analysis and insights on different investments so that you can make informed decisions.

 

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About Andrew Kwabena

The Editor of MoneyInAfrica

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