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Investing means protecting and increasing your money’s purchasing power. When you begin investing your money, you strive to earn a rate of return that is equal to, or greater than the current rate of inflation. Finding the best investment accounts in Canada is easier when you know your investment goals, time horizon and risk tolerance. Learn about investing in Canada and find the best investment type for you.
When it comes to handling money, everybody has a set of unique financial goals. How you choose to invest your money depends on your financial needs and risk tolerance.
If you need your money within the next few months, it is best not to invest in a long-term investment type like a 5-year GIC or a long-term bond. Short-term investment options include High-Interest Savings Accounts, short term GICs and stocks. If you are looking to take some risk with your money, you can look at the stock market. Investing is a very personal choice, so take your time to research the best options for your financial needs.
Your investment decision should rely on the following 3 factors:
Investing doesn’t always have to be without any risk, or solely with risk. You can choose the level of risk you wish to take with your money. Risk tolerance simply means how much of your investment you can afford to lose.
Investments such as, GICs come with very low risk. If you are looking for a low risk investment, a GIC, or a High-Interest Savings Account can work for you.
If you can afford to take a bit more risk, in return for greater returns, try investing in company stocks or ETFs.
Each savings and investment product has its own set of risks and returns. Different risks can include: how readily you can access your money, how volatile the investment is, interest rate risk, currency exchange risk, inflation risk, economic risk.
When it comes to investing your money, there are many great options to choose from. Here are the different types of investments:
Take advantage of tax-sheltered investment vehicles. Here are some of the best options: