After reviewing my portfolio for 2013, I firmly believe that putting money in stocks is definitely better than any fixed deposit you can find.
For about $20K of investment in stocks, my returns is around 6%, or $1260 just for dividends alone. This comprised of REITS like AIMS, Suntec, Mapletree industrial trust, Sabana and SPH stock. If capital gain are taken into account the amount will be even higher.
If that money spent a year in the highest fixed D instead mentioned in the previous post, I would be getting like $226.
That’s a staggering difference of $1034 ! ( or $86 a month )
Some advantages of stocks over fixed deposits other than the returns :
– more liquid; you can sell stocks anytime
– able to give a decent return that beats inflation
– if you hold it longer than 1 year usually the returns are higher given that companies and the economy grows and profits increase
You may be wondering yes stocks do give better returns but it comes with risk as well. This is definitely true stocks come with a higher risk if you blindly run out and buy any random stocks. Same as what happens when you cross the road without looking where you are going or checking out traffic from both sides.
For this reason you need a set of checklist or criteria to determine which stocks are suitable like what I have mentioned here, your risk will be much lower and you can enjoy better returns, why not ?