So You Have Made Some Money On The Stock Market

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So you have made some money on the Stock Market so what have you decided to do with it?

There are countless articles on “How to Make Money” but not too many on what to do with it once you have made it. Let’s look at a few options.

1. You can spend it.

This is of course after you have allowed for capital gains tax or offset against a past loss.

2. You can save it.

3. You can give it to me. Which personally is a great option I am in favor of.(Joking of course.)

The problem now is where is the best place to put your hard earned loot?

A. Banks are fine but the interest on a savings account is around the 4% mark (if you are lucky) and any interest you make is liable to be taxed at around the 25% income tax level. click here This depends on what current tax level you are at currently, plus bank charges and inflation have to be taken into consideration which soon whittles the earnings away.

B. Term deposits pay a better interest rate but your cash is not always readily available when you need it and again the charges/inflation above applies just the same.

C. Invest it in your Superannuation. Good idea, but again your money is tied up and you can only gain access to it when you retire.

D. Managed funds are also fine. This is letting someone else invest it for you for a yearly fee. But you need to shop around before you go down this path. See a financial advisor is best.

E. Or you can invest it back into the Share market. This is my favorite option unless the “Wife” has a prior claim.

When the proceeds have come in the form of dividends and the stock is doing well, I try where possible to join the DRP scheme the company offers. This is where instead of getting cash it is converted automatically to shares. Usually at a lower price than the current market price plus the advantage of not having any brokerage to pay is a bonus as well.

No doubt you can come up with your own ideas on what to do with your profits. And if you want to make more profit, well you can improve your trading skills by going no further than learning from the wealth of knowledge that this site has to offer. But best of all it is all “Free”
and at no cost to you at all. And why you are at it please tell your friends about this site.

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