Investing Articles

If you ask gold or silver investors why they save some of their hard earned cash in the form of precious metals, they will probably give you a long list of reasons. The first reason most give is that the metals tend to hold their value and create a hedge against inflation. They bring up examples like one silver dime could buy a soda in 1964 when it was worth 10 cents. Now the silver bullion within that same coin would be worth about $1.20. So, either way, now or n 1964, you could purchase a soda or a candy bar. That's what they mean by using bullion as an inflation hedge.

It is a challenge to invest $5000 because it is really not enough money to buy wealth producing assets like real estate. However many people overlook land as an investment vehicle. Lets explore now, how you would invest $5000 in land and make some really good returns.

Let's simplify things and get back to basics. Investment is a simple process. The goal is to compound our seed capital at the highest possible level each year. The reason why compounding is the goal of every seasoned investor is because compounding makes wealth rapidly.

If you have ever played with a calculator and recognized how compounding behaves, you will know that the higher the compounder, the more skewed the returns. For example a simple bank deposit will give you a return of say 5% per year. Most investors use a bank deposit as a bench mark that they can use to compare opportunities against this base model. Each investment you make has risk and a bank deposit is the safest of all investments because it is guaranteed by the government.