Investment in the modern age can appear like a daunting task at first, with new financial assets being added every decade and now even every year thanks to the advent of Bitcoin and blockchain technologies which have helped to create more millionaires than ever before in recorded history. We are in fact seeing a definite boom of opportunities across all ages. Opportunities in and of themselves come in different classes of risk, and so in order to best educate people on the types of investments that exist it first becomes important to take a moment and give an honest thought toward how aggressive one’s financial goals are.
In large part, this is based on age and income, while also heavily relying upon investment objectives of the individual(s). The way that most people are taught to invest by themselves is to strictly invest in the markets as what is known as a “buy and hold” strategy”. In America, markets have consistently increased in value over the long haul. For those unwilling to take extensive risks with their finances in order to achieve larger gains, this is by far the most popular and safest way to make money. Many fund managers and financial analysts offer this service but doing so at the risk of becoming “just a number” is why many people turn to more personalized financial planners.
Another way which Millennials are starting to catch on to thanks to the internet is the more passive wealth strategies, which use risk-adjusted models that are back tested over decades in order to achieve objectives. One effective way of ascertaining this while avoiding heavy commissions and fees along the way is by using ETF’s, or Exchange-Traded Funds. Some ETF’s like the S & P 500 are not only reduced in terms of fees, which add up over the long haul but are actually also treated with a “capital gains” preferential tax treatment. In other words, 60% of all wealth gained through ETF’s are treated at the capital gains level of about 10%, while the other 40% is taxed at a normal rate. On average, the savings from cumulative gains of repeatedly investing passively through ETF’s results in a massive boost in income over time.
Compared to often volatile cryptocurrencies, which are notoriously tax-heavy and lack the historical security which ETF’s hold, investing directly into the market via exchange-traded funds is a popular alternative to buy-and-hold strategies of old. Bespoke financial planners such as Bone Fide Financial Management (located in are certainly privy to these investment objectives without treating you like just a number).
The internet truly has opened many doors which were not open before in the financial world; new assets are being added every year, and banking is becoming more and more secure. One little-known fact about banking security of funds is that Goldman Sachs and JP Morgan are quietly acquiring patents for blockchain technology. This makes financial managers able to sleep much better at night, knowing that their clients’ funds can always be securely accessed regardless of the financial climate