The following is
my answer to a Quora question: “What is the most feasible
way to invest money profitably when your income is limited?”
Before considering investing, you need to
take a look at your finances to better understand your liabilities, your
expenses and your liquidity. The purpose
of this is to find ways to maximise you income by cutting down on unnecessary
expenses. This is for you to build your
funds to invest. Keep this money
separate from your normal expenditure account.
Once you have from $1,200 to $2,400, look
for financial products that allow you to put in between $100 to $200 per month
in either some form of an investment-linked insurance plan, or a mutual fund,
depending on your investment horizon and risk tolerance. This is not going to make money quickly, but
managed properly, your ROI over a decade or so, assuming you kept to the same
payment level, without top ups, is still from 30% on the total principal
invested. If, along the way, your
financial capacity improves, avail yourself to other products. It is an incremental build up.
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