One of the many things we are told growing up is to save for our future but when we are young, the future seems so far away so we all really ignore. In Pakistan, usually the youngsters are not very much interested in savings and investments and this is because of the lack of knowledge, little guidance and the absence of any awareness. So through this article, we aim to make a point that how a young professional who has just landed a new job in Pakistan, can consider the available investment options for the betterment of his future.
Considering you have landed your first job, so you will now be in a position where you need to think about your future and how you can make your money work for you. We need to save for our future because retirement is something that can creep up on us very quickly or you may need cash for emergency expenses, family commitments, personal ambitions such as buying a new car, or buying a property or home, professional educational commitments, planning to do repairs to your home or you could even find yourself out of work. The reality is that nobody knows what awaits us around the corner but you can begin investing today so that your money is working for you. So, where should you plan to invest your money?
1- Savings Accounts
It is still possible to save your money in a savings account and get a good return on your investment providing you are willing to meet a number of requirements when opening the account. This is probably the best option for the young professional who has landed jobs recently as they have no hard commitment on a fixed deposit they need to keep in a bank, and they can still make regular flexible payments in their savings account and can still earn profits. Many banks offer different savings accounts with different rates and benefits but you need to consider exactly what it is that you are looking for. Worth comparing all the saving bank accounts offered by Pakistan banks at Mawazna.com. Do you want to tie your money up for 1 year, 2 years or even 5 years? For example, Standard Chartered Bank in Pakistan offers a high yield account with a rate of 3.75% APR while a savings account with MCB can achieve an interest of 7% which can help you to see a healthy return on your investment. However, it is strongly suggested that you check the latest profit rate offers when you apply for a savings bank account. There is a wide range of savings accounts available and that is why you should compare savings accounts to find out which one offers the best rate for the amount you want to save.
2- Shares & Equities
This is an investment that carries with it an element of risk but if you chose to use a broker to purchase shares you need to know exactly what you are doing. You do not want to put your savings into shares that could fail so it is important that you seek the correct advice to ensure that you make the right decisions. Of course, with the correct advice, you could see your investment grow to a very healthy amount. Investment in shares needs a good knowledge of the Market so it is the best idea always to try a small sum to learn how the market fluctuations impact your investments in shares so that you can make the best decision. The decision related to buying or selling of your shares depends very much on the positioning of the company in the market and its ongoing performance. We also suggest you have your investments made in a diversified portfolio to balance the risk appetite associated with Shares market. You can start reviewing various options available through Pakistan Stock Exchange.
3- Mutual Funds
This is an option that could appeal to those who want to invest but are either falling on the side of caution or are unsure of what is required. A mutual fund makes it possible for small investors to invest in a professionally managed portfolio which could include equities, commodities, bonds or even property. The fund is then managed and invested accordingly. Often this does require an element of patience and risk taking but it can be rewarding. Mutual Funds are long term investment choices.
4- Real Estate
It is a known fact that investing in property can help to bring in some good returns whether that is in capital appreciation or even in rental yields. Of course, investing in property whether it is for yourself to live in or for rental could see you achieve an excellent return on your investment when the time comes to sell. The kind of property you purchase is all down to how much extra cash you have to spend but if you need to obtain finance for such a purchase then it is certainly worth comparing the different mortgage deals available to you. It is possible that in your first job, or initial years, you may not be able to spare large sum of cash for property investments however these days in Pakistan, a large number of new developments are being introduced where you can make payments in instalments in case if you buy a small flat or apartment.
There is no doubt that it is vital that you think about your money and your future. They go hand in hand so it is important that you look after one in order to look after the other. There are a number of options available but selecting the right one is down to personal preference. However, where possible, compare the markets and seek the right professional advice because this is crucial. There are several other investment options as well that can be considered and we will highlight those in our upcoming knowledge development series.
Mawanza.com is a leading personal finance comparison platform that allows consumers in Pakistan to choose the best personal finance products (car insurance, health insurance, travel insurance, personal loans, car loans, home loans, bank accounts and broadband products) for their personal needs. Visit us online to compare a selection of personal finance products offered by leading providers in Pakistan.
“Mawazna Karein Apne Liye, Apno key Liye”