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Uzone.id – Investment is a path that will lead to a stable financial future. The ranks of successful people out there have proven that investing consistently is one way to prepare for a safe and comfortable future, at least economically.
Indeed, everyone has different goals when starting an investment. In general, people who invest aim to raise emergency funds, prepare retirement funds, collect business capital, and grow the value of business profits.
However, although many economists have emphasized the importance of investing, not a few are still hesitant to do so. The fear of the risk of losing money, market uncertainty, as well as value fluctuations makes many people anxious. In fact, there is nothing wrong with learning to start investing.
Even though it has a myriad of risks, there are many positive sides to investing. Putting money in investment instruments will increase the chances of making a profit. On the other hand, if money is only saved, the value of money can fall due to inflation. At the very least, the profits earned from investments will help offset the decline in asset values due to inflation.
In addition, instead of relying only on the main income, the profits obtained from investments can be an additional source of money. In general, profits are obtained from the difference between the purchase price and the selling price (capital gain). So, when the value of the asset increases, the owner can sell the instrument at a higher price than the purchase price.
Basically, each type of investment has its own risks and potentials. For this reason, it is important to do research and understand the risks. Time is the biggest asset that Gen Z has.
Not stocks or gold, Gen Z can invest by reading, learning, understanding, and developing skills before actually jumping into investing. Although it does not generate direct financial benefits, this investment will provide benefits in the long run.
So, for Gen Z who are currently just starting their careers and want to start investing, here are investment instruments that can be an option.
ETFs (Exchange-Traded Funds)
ETFs are investment funds that have several underlying assets and can be bought and sold on exchanges. ETF stock prices fluctuate throughout the day, in contrast to mutual funds that are only traded once a day after the market closes.
Why are ETFs suitable for Gen Z? This is because ETFs offer low fee ratios and fewer brokerage commissions than buying stocks individually. ETFs are also suitable for many investors because they allow owners to access a diverse range of asset classes, including stocks, bonds, and commodities.
ETFs also have a lower operating expense (OER) ratio, and combine the flexibility of trading individual securities with the quality of diversified mutual funds to meet a wide range of investment needs. And, last but not least, ETFs are more efficient in terms of taxes.
Cryptocurrency
Cryptocurrencies are interesting to dive into for Gen Z who have a strong orientation in technology. However, it should be noted that cryptocurrencies need a deep understanding because they are extremely risky.
Before buying cryptocurrency, potential buyers should really know and understand what they are buying. Because, cryptocurrencies are not a safe investment. You can become rich and poor in just an instant.
However, that doesn’t make cryptocurrencies scary. Gen Z who like challenges are more interested in this instrument compared to other investment instruments.
Currently, Gen Z has a high concern about inflation, so they often use cryptocurrencies as hedges. Cryptocurrencies also have values that align with Gen Z, such as transparency, inclusivity, and digital.
