It is common wisdom to invest into the stock market for the long term
. But why is this? What are the benefits of investing into the stock market? Why not just forget about it and start spending your money today instead of waiting for your future?
There are actually a lot of reasons to invest your money into stocks, but here are just a few big ones.
1.Income
By investing into the best dividend paying stocks you can actually make some passive income from the stock that you own and this is in addition to the capital appreciation that stocks normally give off. If you are able to save and grow enough money it is possible to live off of the dividend payments by themselves.
But because stocks don't pay you that much it is really a secondary goal. The goal is to invest and grow your money so much that you can eventually live off of the dividends that it produces.
2. Long Term Growth
One other reason to invest into the stock market is that it has good long term perspective. Investors who have held their money over the long term into market averages like the S&P have seen their investments go up on average about 10% a year. That can grow your money pretty nicely over the long term because of compound interest.
Of course, you can always take the time to learn about the stock market and learn how to beat the average return and that would give you an even better approach. There is really no limit to how fast you can make money in the stock market which makes it one of the best places to invest for growth.
3.The Rich Invest
The majority of the self made millionaires and billionaires out there invest their money into the stock market. Well if they are doing it you have to assume that they know a little something about how to make their money grow.
Most of the wealthy people in the world agree that the stock market offers a wonderful wealth building opportunity. So, if you want to figure out where to invest your money and how to get ahead financially why not look at what the people who have been successful in those areas have done and copy them?