What Is Investment To You? Find Out If You/Your Small Business Are Making Costly Investment Mistakes

Not taking time to ask yourself a vital question like; what is investment, could be a very costly mistake that no one ever want to make. Many small businesses struggle with their investments because the managers in charge or the business owners confuse all sorts of financial commitments to be investment. Committing your hard earned money is not a rocket science, it is as simple as understanding the basic rudiments of investing and living by it. In this article are simple golden rules that when followed will ensure that you are not just wasting your money but actually investing them in a worthwhile venture.I will start by providing a non-technical meaning of what an investment is before going further into exploring other condiments that makes an outstanding investment.WHAT IS THE MEANING OF INVESTMENT?In a simple everyday language, investment is a calculated and well articulated move that we make in order to grow our money, Simple!!! For you to grow your money, it has to still remain alive. After all, dead items do not grow. This simple definition of investment will now smoothly translate our discussion into exploring those characteristics that must be possessed by any form of investment.SIX (6) FEATURES AND QUALITIES OF GOOD INVESTMENTSThe aim of this section of the article is to allow you ask vital questions about your investment strategy. If you find your investing strategy wanting in any of these points discussed below, it then could mean that you are taking an investment risk that could be very costly.1. SAFETY: For the money that you commit to any venture to qualify as an investment, the safety of the capital must be assured. You cannot make any sensible investment economic wise if your initial capital is not safe. You need to be sure that you are not throwing away your cash.2. ABILITY TO GROW: After you must have guaranteed the safety of your proposed investment, the next thing that you must look out for is the presence of potential growth. The rate of this growth must be greater than the prevailing and possibly foreseeable inflation rate.3. TRANSFERABLE: A lot of people might find it difficult agreeing on this point but, think of it. How can you divest from the financial commitment involved in investment if there is no way you can transfer your stake in the venture? Is a simple fact, there must be a way of transferring ownership; else, that is not a potential investment.4. CAN RUN ON AUTO PILOT: Real investments do not necessarily need your presence to meet other characteristics of quality investment. So, be sure that what you are about committing your money to will not require you to constantly be there.5. EXISTENCE OF AN EXIT ROUTE: Yes, you must clearly see the exit route before you enter. Do not worry if you lack the skill to do this, you investment adviser will surely be vast in this.6. NOT BASED ON LUCK OR INTUITION: As obvious as this point may be, people still overlook it at their detriment. Investment is too important to be based on mere luck or guesswork.My experience over the years as both an accountant, investment analyst, and an auditor has shown me that any investment that a business makes based on the key principles identified above goes on to flourish and multiply. It does not matter whether you make these investments as a small business or as an already established business.And the good news is that everyone can follow these simple investment golden rules as stated in this article and still get the same result.If however you are too busy to do your due diligence before committing your money to investment, I would suggest that you contact an accountant who has experience in investment analysis or any other professional investment adviser or a qualified financial planner. Your business is too precious to be allowed to die at an early stage.

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