7 Reasons Why You Should Invest in a Fixed Deposit

If you’re thinking about investing in a fixed deposit, then you’re already on your way to securing your financial future. This is not just a smart move, but also a move where you can find a lot of returns for you.

Investing through a fixed deposit scheme have become widely popular, since they are one of the most stable methods of investing, and you’re assured of getting a return. Once you start looking into FDs, check the interest rate that your bank is offering you and see how much you stand to gain at the end of the tenure period.

Let’s take a look at why fixed deposits are one of the best methods of investment.

They’re One of The Safest Methods of Investing

If you’re thinking of investing in something like the stock market, then you know that there’s a considerable level of risk that you have to take into factor. You could stand to gain a lot, or you could lose everything that you sank in.

But that’s not the case with fixed deposits. They’re known to be one of the safest methods of investing. You can choose FD investment schemes that will always expect a return.

They’re Flexible to Your Needs

By flexible, I mean that they’re essentially tailored to have maturity periods that are suited to your convenience. You can choose to lock in a sum of money for as little or as long as you want. Keep in mind though, that you won’t be able to access the money during that period, since it is in the maturation period. Keep this in mind when you’re thinking of opening a FD account.

You can also tailor your periods so that you can qualify for fixed deposit tax benefits, saving you from having to pay taxes on your investment.

They Can be Compounded if you don’t Need your Money

After the end of the maturity period, if you don’t need the money from the fixed deposit, you can reinvest it again and gain additional interest from the total amount that you got. This compounded interest can add up to a lot of gains over time, so if you’re someone that can trust themselves to have a lot of money tied up with the bank for an extended period of time, then this is definitely something for you to consider.

Relatively Safe For Senior Citizens

If you’re a senior citizen, you’re well aware of how precious your money is. You don’t have a stable salary anymore, so you’ll have to think about managing every little bit. For senior citizens, fixed deposits can be a good way to get some extra cash through the money they already have. This means that you won’t have to spend out of your life savings to ensure that you can get through the remainder of the month.

You’ll also find that banks will offer senior citizens a higher interest rate on FD than regular customers, so you can take advantage of that as well.

You Can Save on Taxes

While in other methods of investments, you can and will be regularly taxed, fixed deposits are only taxable once they break the exemption limit. This means, if you can plan your deposits properly, tax saving methods can be all the more beneficial for you, keeping money in your hands without having to pay taxes unnecessarily.

They’re Easy

Other investment routes can be difficult, since you’ll have to do days of research and walk through complicated procedures to get started. That isn’t the case with fixed deposits. They’re relatively easy to open and easier still to maintain.

They Can be a Regular Source of Income

If you have a number of fixed deposits in a number of banks, they can also be a sizable source of income for you, meaning that you can put your other money into other investments, keeping your finances secure.

This means that you won’t have to live from paycheck to paycheck.

Cloud Mining Contracts – Are They a Good Investment?

As readers of my blog know, I will only promote products and/or services that I myself use or invest in. I wanted to provide an update to the cloud mining contracts that I recently purchased. Cloud mining works differently than traditional mining in that you do not purchase any hardware to do the mining for you. This means you do not incur large electricity costs associated with owning your own machine. It is all done by others and you are simply buying into a pool. When I started them on May 23rd I wasn’t really too sure what to expect.

Since two weeks have passed I figured I have a good amount of data and info to provide a solid report. The first contract I started was with Hashing24. They only offer Bitcoin mining. The way it works with them is you buy whatever hashing power you want (for more on that see my post “mining”). They have plans that are as low as 100 GH/s and cost as little as $18. Because they offer indefinite contracts, you pay a small daily maintenance fee of $.033 per 100 GH/s.

The upside to Hashing24’s model is that once you pay your upfront amount you can theoretically collect daily payments forever. In that manner it is similar to buying an immediate annuity.

In the interest of full disclosure I purchased 4500 GH/s ($800). After the daily fees are subtracted and, depending on the value of Bitcoin, I make around $7 per day. If we extrapolate that out it would be about $210 per month with a break even point of just over four months. That’s not too bad an investment because everything after month four would be pure profit. One thing to also keep in mind is that the mining difficulty will increase in the future which will eat into your profits.

On May 25th I decided I wanted to start a contract to mine Ethereum. The Ethereum blockchain technology is being embraced by all the major crypto companies and I actually believe that it will one day pass the value of Bitcoin. It currently about half its size with a market cap of $20,505,000,000 compared to Bitcoin’s $41,888,000,000.

I purchased my Ethereum cloud mining contracts through Hashflare.io. At first I purchased 35MH/s and later to decided to add another 15MH/s. The contracts are for one year. Hashflare also allows you to change the percentage of hash power you want in each pool. If you see one pool performing better, you can put a higher percentage into that one.

The cost for 50MH/s was $1,090, but I got more bang for my buck because I paid in Bitcoins and the value of my Bitcoin purchase appreciated. This meant that my Bitcoins went further and, in reality, effectively cost me around $900. Let’s go conservative and take the higher amount of $1,090.

The calculator on their site predicts that at the current price of Ethereum ($223) I would make $2,358 off my $1,090 investment. That kind of return makes it worth the risk to me.

Again, because I am a long term investor in both Bitcoin and Ethereum, I view this as a solid opportunity to diversify your portfolio and at the same time attempt to make some passive income. Keep in mind that cryptocurrencies are extremely volatile and that can wildly impact your potential profit. Do your homework first. If you are a long term investor in cryptocurrency, this appears to be a worthwhile play.

Purchase Investment Properties On A Budget Using Crowdfunding

What is Crowdfunding?

If you are tired of low returns from Certificates of Deposit, Thrift Savings Plan and other Equity Investments, check out Crowdfunding for double digit returns. Crowdfunding is gaining in popularity as an investment strategy for many investors. It is a unique process to raise capital through family and friends, potential customers and individual investors looking for different investment venues. To promote Crowdfunding, advertising is a focused approach utilizing social media and real estate investor forums and associated networks.

What Platform is Right for Me?

My preference is Crowdfunding with real estate investments which I will discuss here. There are many different strategies and models of crowdfunding platforms so you want to be sure that the platform you select is a good fit for you. Ask the question: Am I comfortable with the amount I’ll be investing? Do we share the same values? Are you in agreement with their investment strategies such as flipping houses or buy and hold for long-term passive income? The amount required to invest will vary with each venue so shop around until you find one suitable for your investment portfolio.

Do Your Homework

Do your homework before investing. Historical performance is a good indicator of future performance. Get to know the management team and see what they are doing on social media. How transparent are they and how willing are they to talk to you and answer your questions, including the hard ones. Those that a more willing to share beliefs, management and goals tend to do better for themselves and their customers over the long term. Also reach out to other investors to get their input and endorsement.

Do the Math

I have seen many attractive returns advertised to only find out they were tickler rates to get you to call. Do your homework to see if the numbers are realistic. Ask how much detail is provided on the business? How can I access my investment and returns after I have committed? How and when are investment returns distributed? What type of reporting (personal and legal) is provided to the investor? Make sure you are comfortable with the management team and security of your investment before taking that first step.

Crowdfunding Example

I personally invest with Holdfolio. Their buy-and-hold platform consists of 10 rental homes within a single portfolio. These houses are purchased, reconstructed for rental ready use and then leased. 60% ownership is provided to investors (the crowd) with a $10,000 minimum investment. 40% ownership is held by the Holdfolio management team. Advertised returns when I invested over a year ago were 10% to 14% and am currently realizing 11% returns annually. With each new portfolio, 10 additional houses are offered to investors at an average crowdfundng pool amount of $320,000 which is usually filled within 4 to 5 days. Holdfolio just finished Portfolio 10 and is beginning Portfolio 11 soon. This is just one example of many crowdfunding platforms.

Summary

Real estate crowdfunding is quickly becoming more popular today as investors move away from equities to search for greater returns in other markets. Be sure to do your homework and narrow your search to a top three. If this is your first time, once you make your selection start with a smaller amount until your comfort factor allows you to do more.