How to invest my money? Products, platforms and strategies

It may come as a surprise, but the first person who wondered how to invest my money dates back to 600 B.C. and it was a rather well-known man: Thales of Miletus. The story goes that the philosopher managed to predict, thanks to his astronomical knowledge, a very good olive harvest in the following season, so he decided to hire a large part of the oil mills in the region. When the great harvest came the following year, Thales made a large profit and became one of the richest men in all of Greece.

Thales’ story goes much further, in fact, he is said to be the inventor of financial derivatives (because of the way he ran the operation), but the remarkable thing is that he demonstrates the importance of investing one’s savings wisely and waiting patiently for it to pay off. Today, those lessons are still valid for knowing how to invest my money.

Why is it important to invest money?

Investment is the activity by which a person, a company or any institution allocates a series of resources, which may be their own or others’, to another activity that allows them to generate profits over time. The importance of investment lies precisely in the fact that the profits obtained can be used to meet future needs, so as not to lose purchasing power, or reinvested to generate more.

How to invest my money: Where do I start?

When it comes to knowing how to start investing my money, one must be a smart investor and develop a strategy. In this case, the story of Thales serves as an example because it shows us that the first thing he did was the tactic he put in place when he recognized a good future harvest. In our case, we may not have the philosopher’s expertise and knowledge, but neither is it necessary. In fact, to begin with, we only need to be clear about certain concepts.

  • The risk: in many occasions it is not easy to calculate it, so the most convenient thing to do is to know ourselves and ask ourselves how much risk we accept. If we prefer, more practical, how much capital we can lose without compromising our financial future.
  • The objective: investing implies achieving some goal, so being clear about the objective of our investment will help us to opt for one type of strategy or another. However, we must bear in mind that if we have very ambitious objectives, we will probably need a more aggressive style. Therefore, firstly, we must know the risk we can assume.
  • The resources we have: having sufficient savings is essential, although not the most important thing, since each investor has different resources and perhaps what is a lot for some is little for others. In addition, the investment world has democratized, so that anyone can be an investor without having large resources.
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How to invest my money: the products that are best for me

Once you have the strategy of how to invest my money, it is time to put it into action, that is, to start investing. Although at first glance it does not seem simple, if you follow some steps and rules, it can be done.

The first step will be to evaluate your knowledge and the time you can dedicate to it, since this will determine whether you invest according to your own criteria or leave it in the hands of others. Obviously, most people tend to leave it in expert hands, even when they are knowledgeable. Once that is clear, the second major distinction is: Active or passive investment? The difference is that the latter is more convenient, as there are more products and the costs are lower.

The third step is to project your strategy towards the markets. Broadly speaking, if your profile is conservative, the best choice will be fixed income or savings products, with which your capital is safe. If you are more daring, the option will be equities, since the returns can be higher, but so can the losses. In both cases, the last step is to choose among the investment vehicles that best fit your profile, among which index funds or ETFs stand out.

Robo advisors: platforms that will make your life easier

Obviously, the above does not cover the whole essence of the process, since it requires much more, but it serves to make a mental plan of how to invest my money. However, there is a much simpler option: using a robo advisor.

Simply put, a robo advisor is an automated investment manager, that is, a digital platform that offers automated investment portfolios at reduced costs. For the most part, the suggested investment portfolios are usually composed of index funds and/or ETFs that are adjusted to the profile of each investor, thanks to the fact that they use algorithms trained for this purpose and sharpened by a group of experts behind the platform. With them, you will not have to worry about almost anything when it comes to understanding how to invest my money, since it will do all the work and always seeking to maximize the value of your savings following your preferences and risk profile.

Start investing the easy way with inbestMe

A good option if you are looking at how to invest my money is to do it through the convenience offered by robo advisors is to choose inbestMe. It is a platform with a long history in Spain and has a wide range of different products to invest.

For those more conservative profiles, inbestMe has products such as its savings portfolio or the conservative fixed income plan, which is perfect. However, it also has other types of more aggressive offers to gain more profitability through its index funds and ETFs that follow stock market indexes and that have proven to be very profitable. It also has pension plans for different profiles. Finally, it complements this offer with SRI (socially responsible) versions of each product for those who, in addition to wanting to see their savings grow, also want a better world.

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