Many people are interested in investing but lack the knowledge to make a sound decision. Smart investments grow your wealth and create a roadmap for a financially stable future. The following guide explains some of the investing basics to discuss with an accounting and financial services expert. 

How Can You Invest Your Money?

1. Stocks

When you buy a stock, you’re investing in the success of a company. As stock prices go up, so does the value of the stock you purchased. However, if prices go down, you’ll lose money.

Most people purchase stock through a broker, who can help you make the right decision based on the amount of money you’re investing and the level of risk you’re willing to tolerate.

2. Bonds

Bonds are a type of loan you provide to a business or government that accrues interest over time. There are three different types:

• Corporate Bonds: These are bonds issued by companies. 
• Municipal Bonds: Local governments, such as state or city entities, issue municipal bonds. 
• Treasury Bonds: These bonds are issued by the U.S. Treasury as an alternative to taxation. 

Bonds are extremely low risk, which is important to some investors. However, because they lack the volatility of the stock market, the returns are usually much lower. An accounting and financial services expert can help you decide which option is best for your financial needs.

3. Mutual Funds

With mutual funds, many investors combine their money to invest in a single fund. The money can be invested in stocks or bonds.

Sometimes, a manager will actively seek out specific investments predicted to increase in value. Mutual funds can also be passively managed, which means they’ll align with the Dow Jones or S&P 500.

Do you still have investment questions? If so, Sharrard, McGee & Co., PA, can help you make smart financial decisions. With locations in Greensboro and High Point, NC, they provide a range of accounting and financial services to help you grow and manage your wealth. In addition to services aimed at individuals, they also help businesses remain in compliance and financially sound. Visit them online to learn about their investment strategies. Call (336) 884-0410 to discuss your financial needs.