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Investment for Beginners: How to Start With Little Money
Set funds aside and grow it using the GCash app
Setting aside money for your savings ensures that you have something to fall back on during rainy days. It's also the most basic way to slowly but surely build your wealth, and pave the road to financial freedom.
But beyond setting aside a few pesos every month, another way to substantially grow your wealth is through investments. Investing can increase your money's value over time. Coupled with saving, funneling a portion of your disposable income into an investment can help you achieve your financial goals faster.
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You have several investment options to choose from—real estate, mutual funds, stocks and bonds, to name a few. Keep in mind that not all investments are beginner-friendly. There are certain risks associated with different types of investments.
A key principle in investing is "High risk, high rewards. Low risk, low rewards." Additionally, investments that promise bigger yields typically require a larger amount for the initial investment.
As a beginner, you'll want to start with something more budget-friendly and less risky. It may take more time for your money to achieve exponential growth, but your prudence will be rewarded. Whereas being rash and aggressive can cost you what you've worked hard for.
So, where do you start investing with little money? Read on to find out the top investment for beginners.
1. GInvest
GInvest is one of the newer GCash services. It is an investment marketplace feature on the GCash App that allows its users to invest in up to five different funds. These options include Global Consumer Trends Fund, MMF, Philippine Smart Equity Index Fund, Philippine Total Return Bond Fund and Global Technology Feeder Fund.
GCash investment is excellent for beginners because you don't need to shell out a huge amount to get started! The app helps you choose an appropriate investment option depending on how much risk you're willing to take. This ensures that you're not biting off more than you can chew.
How to Start Investing with GCash GInvest
You can begin investing for as low as Php50. All you need to do is register for the feature on the GCash app and answer a quick risk profile questionnaire. From there, you can monitor and handle everything on a smartphone. Cashing in and out is also convenient and quick with the app.
2. Government Retail Treasury Bonds
Retail Treasury Bonds (RTBs) are typically medium to long-term investments that the government issues. This program provides retail investors and individuals access to government securities with a quarterly interest rate.
Beginners can easily invest here because the RTB program is risk-free by default as it is issued by the government. RTBs also earn a fixed interest rate over the bond term, with interest paid every quarter.
The Philippine Bureau of Treasury (BTr) typically schedules an "Offer Period" when newly issued RTBs are sold to the public through banks and other official selling partners. A minimum investment of Php5,000 is paid for the first issuance or primary market.
How to Start Investing on RTBs
To avail of the minimum investment, log on to www.treasury.gov.ph and fill out the necessary order forms. The process will be marked complete once you pay the principal cost.
3. Time Deposit
Also known as a Term Deposit, Time Deposits are a type of bank account where your savings are locked for some time. The money in your account is insured by the Philippine Deposit Insurance Corporation (PDIC).
Time Deposits are a safe and low-risk form of passive income, making it great for beginners who don't know where to start. This investment option also gives you better returns on your money compared to a regular savings account.
How to Start Investing on Time Deposits
Opening a Time Deposit account requires a minimum of Php1,000 to Php10,000, depending on your desired bank and the period it offers.
Road to Financial Freedom
Building up good financial habits is key to financial freedom. Apart from setting aside money in your savings account, start investing! Your future self will thank you for it.
With GInvest, you can begin investing any time for as low as Php50. Start now and watch your money grow on the GCash App.
