Are you living in the Netherlands and you want to “Make your money work for you”? It’s time you start investing.
Invest in the Netherlands
Have you ever wondered that your hard-earned money is getting wasted by just sitting idle at one corner, although it can do wonders for you if you allocate it some work? Ahh!! A lot of personification!! It is quite interesting to know that we can make our money work for us and investment is a means to make it possible.
An investment is an asset or item acquired with the goal of generating income or profits.
So, what are the different investment options we have in our bucket?
Stocks are the traditional investment method. You pick a company, and buy a given number of their stocks. With that you become partially an owner of the company. The advantage of investing in stocks is that you can do stock picking, choosing which company you want to buy. There are several (free) tools out there which can help in the process, like Yahoo Finance , Finviz or GuruFocus .
Some of the popular strategies for investing in stock market are:
Long term investment
Treat this as your long-term investment option like 10–30 years, meaning you should only buy and hold stocks. Do not ever get into day trading, call options, timing the market, buy & sell games. Betting money on luck is a bad idea.
Index Fund or ETF (exchange-traded funds)
Don’t get excited and buy all the fancy stocks you see. Instead of buying 10–20 stocks & managing it, for starters it’s good to go for Index Funds or ETF. By owning one share of an ETF, you indirectly own a small portion of several different companies.
Some of the highly recommended ETFs are
- VWRL (Total Market, covers 3455 stocks, 0.22% expense ratio)
- VUSA (tracks S&P 500, covers 505 stocks, 0.07% expense ratio)
Even you can buy fractional shares of these ETFs so you can start investing from as low as €1 them.
Trading212 is by far most favourite platform of investors for investing in the stock market. Once you start using this platform, it feels too good to be true but it is. Their mobile UX is so great and very easy to use, they also got Apple Pay, Fractional Shares etc and is beginner-friendly.
Degiro is a very good investment platform found in 2013. It is a decent mobile application and is supported in multiple European countries and offers commission-free transaction if you buy an ETF from their commission-free ETF list. It provides investor protection for assets (€20,000)
A mutual fund is a type of financial vehicle made up of a pool of money collected from many investors. Mutual funds are operated by professional money managers, who allocate the fund’s assets and attempt to produce capital gains or income for the fund’s investors
Mutual funds give small or individual investors access to professionally managed portfolios of equities, bonds, and other securities. Each shareholder, therefore, participates proportionally in the gains or losses of the fund.
Invest in Cryptocurrencies
Digital currency which first became a buzz word on the internet, is becoming more and more real in recent times, and many payment providers are considering supporting cryptocurrencies in their platform. Many companies are backing their cash with cryptocurrencies.
Recently Paypal (one of the largest payment providers) announced that it will offer and accept cryptocurrency for all online payments. So, if you are interested in this space then here are some options to buy cryptos:
Peer-to-peer (P2P) lending enables individuals to obtain loans directly from other individuals, cutting out the financial institution as the middleman. This is a speculative space since your investments are not secured, borrowers credit rating requirements might be less when compared to borrowing from the banks. Some trusted platforms for P2P Lending are:
Having financial education proves to be a great support system in the marathon of investment and is a must have. Investing is a steady process and holds great benefits if done patiently and with awareness. Happy Investing!!
There are a lot more options to save money in Netherlands, Checkout Save money in Netherlands – Tax Deductible: Top 8 expenses you didn’t are tax deductible for more insightful grasp over your money.