With so many options available to the everyday Australian, the notion of asset allocation can be a daunting one. Is it in crypto? Property? Cash at the bank? Needless to say, your money can always be working harder when you allocate your assets correctly.
A few simple questions
Asset allocation can be tough – especially with so many easily accessible places to put your money at the touch of a button. The truth is before you make any decisions you have to ask yourself a few simple questions to get the ball rolling. Firstly, what’s my risk? Any pro knows that weighing up your risk before anything else is paramount. Secondly, what kind of return can I expect?
Chasing returns in assets classes you don’t understand is a recipe for disaster. Of course, this will depend on how much capital you have available and how much time you actually have – sometimes our most scarce commodity. if you want to learn about how to buy back 3-5 hours a week, make sure to check out Winning the Game, a journal for planning your assets. Knowing who you are and what your appetite is like is the first step in any asset allocation plan.
Having a horizon mindset
Let’s get this straight – you can’t have everything you want right now. Most asset classes take time, commitment and a clear action plan to be able to afford. Thus, having a horizon mindset that looks into the years and months ahead is critical. The game of money is one that should played to a plan that allows you to grow your asset allocation pool over time.
Cyrpto – watch out, you may get burnt
If you are yet to hear about crypto and what it is then you need to stop living under a rock. Yes, this asset has some usefulness to it like block chain technology in companies like Kodak for example. However, the fact of the matter is when allocating your assets you simply don’t want to be playing at the casino. Cyrpto is a lot like roulette, you’re only guessing which colour the dice is going to land on, therefore it is best to watch out.
Cash – a lazy place to park your money
The old adage that “cash is king” has never been more false. The truth is, interest rates sit at just 0.75%. So having it as an asset allocation class in today’s world is not a valid option. After tax and inflation, you’re actually losing money. That’s right, unnervingly cash at the bank is simply not safe – it’s not working hard enough. Just like the bond market, the yields on cash are really quite thin even in something like a term-deposit.
Property is an expensive game
The reality is that the property market is overvalued right now. Allocating a chunk of your cash for something that requires upwards of a 20% deposit can seem extremely daunting given property prices are at an all-time high – an expensive seat at the table.
The stock market – income, paid up-front
Like property, there are many facets that make up the inner-workings of stock market
money. Looking to generate regular, immediate and up-front income that is guaranteed is something Australian Investment Education has specialised in for many years. By using a time-tested strategy called Cash flow on demand, their strategy mitigates risk and allocates cash in the right stocks to earn an approximate 2-3% every 4-6 weeks.
Work smart so your money can work hard
The fact is, there is a multitude of places to park your money to earn a return. What kind of return, and at what risk level are the key questions to ask yourself when looking to correctly allocate your assets. Whether it’s in crypto, in cash at the bank, or in the stock market, it is pivotal to have both the correct mindset and strategy to accompany you.
Specifically, if you would like to know more about how Australian Investment Education has helped thousands of people earn an immediate, up-front income in the stock market, check out their website to start winning in the market place.