People with money that is not being used to pay bills may want to do something more creative with it than simply allowing it to sit in a bank account. Investing in a profitable business is an interesting and financially sound way of helping your money work for you.
Investing in a corporation is a fairly easy thing to do, since attracting investors is inherent to a corporation's business design. The safest way to buy stock in a corporation is to hire an experienced investment professional. You can also pursue investments independently, but you will be at higher risk of losing your investment unless you really know what you're doing. The best corporations to buy stock in are companies that have a proven track record and have been around for a while. On the other hand, if you are a risk taker, you can try to predict which companies will be "the next big thing." If you happen to be right, you could make a large amount of money in a very short time.
Investing in a small business can be a more interesting undertaking than simply buying stock in a faceless corporation. Entrepreneurs are always seeking "angels" to invest in their ideas. A collaboration between the right investor and the right business person can lead to a profitable relationship for both. Many angels put their money behind businesses and projects that are working in fields they believe in, providing them with personal satisfaction as well as profit.
As a rule, potential profits have a direct correlation to potential risks. The big-money fields are also the fields where you run the risk of losing it all. Savvy investors always keep at least part of their investment portfolio in solid, sometimes boring enterprises that are nearly guaranteed to provide a reliable, if small, return.
When you have built an investment portfolio that represents a variety of sound investments, you will have a nest egg that provides you with a modest but continually growing income. Avoid investments that promise unrealistic returns, and certainly avoid get-rick-quick scams.
Jagg Xaxx has been writing since 1983. His primary areas of writing include surrealism, Buddhist iconography and environmental issues. Xaxx worked as a cabinetmaker for 12 years, as well as building and renovating several houses. Xaxx holds a Doctor of Philosophy in art history from the University of Manchester in the U.K.