How to Protect Your Money In Times Of Financial Crisis
Hard times are coming (horror music), unless you know how to protect your money.
The country is undergoing major changes, at the federal level, that affect the country’s economy.
But don’t worry, even the most solid economy goes through times of drought, the key is to know the options you have to protect your money during the storm.
Many people think that the best way to take care of their money during a financial crisis is to hide it under the mattress. Big mistake.
But don’t worry, we want to help you get the most out of your money through a smart investment.
Save or invest?
Saving your money during times of crisis, instead of investing it, is a big mistake and you will surely be thinking that it is a very risky statement, so we explain, imagine the following situation:
The country suffers from difficult times, you see inflation around the corner and you decide that it is best to stop spending your money and start saving.
Let’s say yes, but no.
The correct thing is to stop spending, but by “saving” you are not making your money grow, on the contrary, you are losing.
There are different ways to save, but the one that is based on simply leaving your money at home and doing absolutely nothing with it so as not to lose is the worst financial decision you can make.
With this, your money will not disappear, but it will lose value due to the devaluation of the currency, a product of inflation, that is, you will continue to have “x” amount but it will no longer be worth the same.
Investing during a time of inflation is the best way to protect your money, we tell you why: When you decide to invest your money you are making it work and generate a return, the secret is to invest in something that generates an equal or greater return to the percentage of inflation.
The Best Three Investments In Times Of Financial Crisis
There are financial instruments that, by their very nature, provide better returns than others during a crisis, here we present them:
- Shares On The Stock Market
One of the ways to keep your purchasing power afloat is by investing in stocks on the stock market, since their dividends rise with inflation.
It is important to mention that many times, even if you feel that your investment has doubled, you will probably only be coping with or keeping pace with inflation, that is, you will not be earning as much as you would during a time of economic stability, but you will not be losing.
This type of investment is for those investors with a risky profile, experience and an eye for investments, since the stock market can be a very volatile instrument.
Extra tip: If you decide to invest in the stock market, do it in companies that go into debt, that is, those that have enough liquidity to acquire debt during a crisis.
This usually happens after a company performs a complete analysis of its capabilities and has concluded that the sum of its assets is sufficient to cover its liabilities, or in other words, its debts.
- Real assets
A smart investment has diversification as a characteristic, that is, not putting all your money in the same thing.
Real assets are a great way to invest during the crisis because, unlike financial assets, they do not lose their value in the same way with inflation.
Some examples of real assets are:
- Real estate
- Intangible assets
- Precious metals
Finally, investment in gold, silver and other precious metals that are priced in dollars, and are considered an excellent investment in extreme periods, both of inflation and deflation.
This is related to distrust in national currencies and that they generate a loss of value in them.
Now you know the most appropriate methods to apply in other to protect your money in times of financial crisis.
At Yabamusicng we are ready to provide you with the most appropriate options for you to invest in real estate and you can prepare for any scenario you just need to ask for information