3 Shrewd Investment Ideas for Your January Bonus

Shrewd Investment

Whether you are a recent college graduate working on your first job or you have been in the workforce for years, you may eagerly be looking forward to receiving your January bonus this year. Depending on where you work and what your overall compensation package includes, your bonus may be rather large, and you may be thinking about investing it for future financial gain. If you are looking for great investment options for your upcoming January bonus, you may consider a few of these investment ideas.

Purchase Stocks
Stocks are generally considered to be a riskier investment to make, but you can do research about your options to mitigate risks. Some stocks are inherently less risky than others due to the stability of the company and sound financial records. Consider looking for stocks that you can hold for a long period of time and that may increase in value considerably over the next few years or even decades. These may be established companies with limited volatility that sell products or services that will stand the test of time.

Invest in Mutual Funds

For those who are not comfortable with a stock investment with the volatility of market conditions, investing in mutual funds is a great way to increase your potential return while mitigating risk. Just as stocks are risky, mutual funds are as well. However, a single mutual fund may contain a mix of stocks, bonds, CDs and other investments, and this can reduce your overall exposure to risk. You may consider researching mutual funds in the same way that you would research stocks to lower your exposure to risk.

Add to Your Savings Account

Another idea is to add to your savings account balance. A savings account is typically not going to provide you with an incredible return on your investment, but there are benefits associated with increasing your savings account balance. When you have a higher savings account balance, you are less likely to rely on credit cards and loans in a time of financial need. Because of this, you can increase your savings account balance to improve your overall financial situation going forward.

These are just three investment ideas for you to consider for your January bonus. Keep in mind that your overall desire for return on investment coupled with your tolerance for risk and the amount of funds you have available for investment should all be considered when you are making your investment decisions.

Image credits to : Equity Bank of Minnesota


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