A letter to a recent lottery winner

What makes a good wealth investment company?

A good wealth investment company has enough knowledge, this means that
they are aware of the economic situation and can anticipate ahead for anu
fluctuations that would potentially occur. Another aspect would be timing,
knowing when to invest holds a lot of weight in terms of the return that would
occur. In addition to this is essential to know how much to investment, what is
worthy investing more into and what it worth less investing into. Personal
financial safety is essential as a return on these investments isn’t guaranteed
and can also take years, therefore it is important that for the time being you
have enough until you receive your return.

How investing can help them?

-Investing can help stay ahead of inflation. This is because say if you invest
money and earn a return of 8% on average and the rate of inflation has risen to
5% you would be ahead of inflation, and this will mean it will increase the
value of your money.
-Investing has the ability to growth your wealth exponentially overtime, this is
because investing would ensure you gain returns later on this gives you the
time to maybe invest into a range of institutions or work on building an empire
which is able to hold great wealth.
-Finally, investing helps to ensure you return sooner than everyone else, the
more you invest the more advantage you would be able to take of compound
interest, this would then put you in an advantageous position in comparison to
someone else.

Why investing is better than letting it sit in the bank?

-One of the main reasons to not keep money in the bank is due to fluctuating
interest rates, interest rates are manipulated according to the economic
position, if the economy was in a recession this would mean interest rates
would have to fall, initially this would mean tat in real terms the value of
savings would decrease as well as the reduction of return earned.
-Investing depends on the company performance not necessarily the economic
performance, we could argue that as investing is tailored to specific
organisations this lessens the risk of gaining a less return. However, investing is
risky, a return isnt guaranteed, however by placing money in a bank it is
guaranteed but magnitude may not be significantly large.