Q: I've been working for the past 20 years, and frankly, I want to get out of the rat race someday. I don't want to continue working until I die. Aside from starting a business, what other ways can I earn money without working so hard? - Paolo
A: It sounds like a good deal - the idea of earning money without working so hard. After working in the corporate world for a long time, you may have a valid reason for leaving the work force. You may be tired, you want to take it easy, or just want to enjoy the fruits of your labor.
While starting a business can let you earn money on your own and let you have control over your own time, it does entail a great deal of work. Many successful entrepreneurs credit their success to working hard, maybe even more so than those employed full-time in the corporate world. Indeed, it takes a great amount of sheer guts, determination, and sweat to build a business from scratch. But the rewards in the long run will be sweet and fulfilling.
Is there a way to earn money without working hard? Yes, there is. It's called investment. You save an amount of money, put it in an investment product, then let it earn interest on its own over time. There are many financial products you can choose from. Let's go over some quickly:
1. Government securities. You can invest your money in potentially less risky securities issued by the Philippine government. Such papers include retail treasury bonds (RTB), treasury bills, and treasury bonds. Treasury bills or T-bills are short-term instruments with a term of less than a year. Treasury bonds may have a term of 3 years or 5 years, wherein you lock your money for that period of time. With an RTB, you can invest an amount as little as P5,000. T-bills and treasury bonds require a bigger amount of money. These instruments offer a higher interest rate than that offered by bank deposits, at potentially lower risk to the investor, meaning you are taking on the credit of the Philippine government in order to receive your principal back at the end of the term. Interest will be credited to your account regularly (e.g., quarterly) during the entire length of the term.
2. Bonds. You can also "lend" your money to corporations raising additional capital and you will get a regular interest income over the length of the corporate bond to be issued to you. There is some risk involved as there is the possibility of default on the part of the bond issuer; however, you will need to exercise prudence and in choosing which bond to invest, consider a number of factors, including looking at issuers which are reputable companies with good business track record in terms of product and service, creditable industry standing and solid financials in order to determine whether investment is appropriate for you. The rate of return may be higher than that offered by bank deposits and government securities.
3. Stocks or equities. You may "own" a piece of a company listed on the Philippine Stock Exchange by buying shares of stock. There is a minimum board lot (minimum shares to be purchased, in other words) and you have to deal with a licensed stock broker, thus you also have to shoulder broker's commission and other fees. However, stock prices may shoot to the roof anytime, thus it is possible to earn more income with this investment rather than bank deposits, government securities, or bonds. But bear in mind that with the volatility of the market, stock prices may also go down in value, way below your purchase price, which will give you a loss. The risk is high in this investment, but investors who are in it for the long term may reap the benefits.
4. Pooled funds. You can join a fund pooling investments from other small investors. These funds may be mutual funds run by mutual fund companies or unit investment trust funds managed by banks. With these funds, you don't need to monitor the markets daily; the fund managers do that and invest the fund as they see fit. All investors share in the gains and losses of the funds. The price of the mutual fund share or unit investment trust fund changes depending on the net asset value per share / per unit on a relevant day. There are funds that invest only in bonds (bond funds), equities (equity funds), money market (money market funds) or a combination of them (balanced funds).
5. Real estate investment trust (REIT). This is a fairly new investment vehicle, with the law being passed in December last year. However, REITs have been a regular in the investment arena in other countries. REIT makes it possible for investors to own a part of an income-generating property. This may be a good addition to one's investment portfolio.
So it is possible to earn money without working too hard? Yes – you just have to make your money earn for you via investments. Save money, then invest it to reap the results. Talk to your bank or financial adviser today to find out which investment/s you may consider that would suit you best.
Source:Inquirer.net
A: It sounds like a good deal - the idea of earning money without working so hard. After working in the corporate world for a long time, you may have a valid reason for leaving the work force. You may be tired, you want to take it easy, or just want to enjoy the fruits of your labor.
While starting a business can let you earn money on your own and let you have control over your own time, it does entail a great deal of work. Many successful entrepreneurs credit their success to working hard, maybe even more so than those employed full-time in the corporate world. Indeed, it takes a great amount of sheer guts, determination, and sweat to build a business from scratch. But the rewards in the long run will be sweet and fulfilling.
Is there a way to earn money without working hard? Yes, there is. It's called investment. You save an amount of money, put it in an investment product, then let it earn interest on its own over time. There are many financial products you can choose from. Let's go over some quickly:
1. Government securities. You can invest your money in potentially less risky securities issued by the Philippine government. Such papers include retail treasury bonds (RTB), treasury bills, and treasury bonds. Treasury bills or T-bills are short-term instruments with a term of less than a year. Treasury bonds may have a term of 3 years or 5 years, wherein you lock your money for that period of time. With an RTB, you can invest an amount as little as P5,000. T-bills and treasury bonds require a bigger amount of money. These instruments offer a higher interest rate than that offered by bank deposits, at potentially lower risk to the investor, meaning you are taking on the credit of the Philippine government in order to receive your principal back at the end of the term. Interest will be credited to your account regularly (e.g., quarterly) during the entire length of the term.
2. Bonds. You can also "lend" your money to corporations raising additional capital and you will get a regular interest income over the length of the corporate bond to be issued to you. There is some risk involved as there is the possibility of default on the part of the bond issuer; however, you will need to exercise prudence and in choosing which bond to invest, consider a number of factors, including looking at issuers which are reputable companies with good business track record in terms of product and service, creditable industry standing and solid financials in order to determine whether investment is appropriate for you. The rate of return may be higher than that offered by bank deposits and government securities.
3. Stocks or equities. You may "own" a piece of a company listed on the Philippine Stock Exchange by buying shares of stock. There is a minimum board lot (minimum shares to be purchased, in other words) and you have to deal with a licensed stock broker, thus you also have to shoulder broker's commission and other fees. However, stock prices may shoot to the roof anytime, thus it is possible to earn more income with this investment rather than bank deposits, government securities, or bonds. But bear in mind that with the volatility of the market, stock prices may also go down in value, way below your purchase price, which will give you a loss. The risk is high in this investment, but investors who are in it for the long term may reap the benefits.
4. Pooled funds. You can join a fund pooling investments from other small investors. These funds may be mutual funds run by mutual fund companies or unit investment trust funds managed by banks. With these funds, you don't need to monitor the markets daily; the fund managers do that and invest the fund as they see fit. All investors share in the gains and losses of the funds. The price of the mutual fund share or unit investment trust fund changes depending on the net asset value per share / per unit on a relevant day. There are funds that invest only in bonds (bond funds), equities (equity funds), money market (money market funds) or a combination of them (balanced funds).
5. Real estate investment trust (REIT). This is a fairly new investment vehicle, with the law being passed in December last year. However, REITs have been a regular in the investment arena in other countries. REIT makes it possible for investors to own a part of an income-generating property. This may be a good addition to one's investment portfolio.
So it is possible to earn money without working too hard? Yes – you just have to make your money earn for you via investments. Save money, then invest it to reap the results. Talk to your bank or financial adviser today to find out which investment/s you may consider that would suit you best.
Source:Inquirer.net
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