Recent times have significantly altered our mind-sets and subsequently our behaviour. For most people alive today, the developments of the past year were totally unexpected and served as a complete shock to the system. There are several ways how the past months could have impacted one’s point of view and this will influence his or her financial making decisions.
Playing it safe
In view of an uncertain global scenario, one of the common behaviours is that of keeping hold dearly of excess liquidity. Considering the economic contraction and lack of entertainment avenues due to the COVID-19 restrictions, many people ended up saving a lot of money. This is especially the case if their commitments are low and incomes remained stable. Customer spending remains low and in this environment, many have decided to shelve their money for when the situation gets better.
Another segment of people includes those that still invest even during these troubling times. Although these people still do invest, they engage in cautious approaches. One type of investment which has been popular during these past months is the acquisition of property for first time buyers. In view of the government’s slashing of tax rates for a limited time period, many have taken the opportunity to acquire their first home. This allows one to buy a property and save a good number of thousands from tax. This type of investing would only be applicable to those who have maintained a significant amount of income.
Although many may express their surprise at those who would still be courageous enough to invest and lock their funds away, in the face of these trying times, money can still be made. Even during the period of the COVID-19 pandemic, there are those who invested wisely and managed to make money. Such types of investors include those who place their funds in bitcoin, like dogecoin. The positive promotion made by Elon Musk has boosted the value of its shares significantly, with those who invested large sums making enticing returns.
During such a volatile period in our existence, finding the right balance of where to invest is no easy feat. This would really depend on one’s existing sources of income and risk appetite. The appetite for investment is expected to increase as restrictions worldwide are easing.
What do you make of investments in the current period? Are they worthwhile? Let us know your views in the comments section below.