The mathematical formula for making money

When it comes to making money there are many mathematical formulas or different variables to consider.It all depends on what kind of "money making" you want to get yourself into.The first thing that comes to mind with making money is the word investment.And with investment comes many a formula, or ways for making money from investing your money into stocks or mutual bonds compared to a simple savings account.Or investing money into owning your own business.They all have a different ROR or rate of return and all have a different formula for making money.Let's take a look at what you can do to make more money.

Investing in Stocks-High Risk
The purpose in stock investing is to redistribute wealth from those who have a lot of it, to those who don't.Buying stock is very similar to buying a lottery ticket in that you can only lose what money you have initially invested.The big difference is that you have the potential to earn much more than what you have invested, which is why investing in stock is very risky.In the past, stocks have been known to return more than ten percent annually.Unfortunately, if you are looking for an actual equation for making money, there isn't one with the stock market.Investors, who are capable of waiting out the ups and downs of the market, are usually the most successful.

Investing in Mutual Funds-Moderate Risk
Something else which can help with your quest for making money, is investing your money into a mutual fund.What is a mutual fund?It is the money investors use to create a portfolio of bonds, real estate, etc.Each investor gets a piece of the pie so to speak.The nice thing about mutual funds is that they demand only a moderate amount of risk and require minimum investments.You can invest anywhere from a couple hundred to a couple thousand.The rate of return can be anywhere from 1-6% This allow you as an investor to create more for much less than investing your money into stocks.As a drawback there are some fees that you as an investor will have to pay.The largest is called an expanse ratio fee.This is a percent that is charged for management expenses and are usually below 0.5%.You might also be required to hold a minimum balance along with transaction fees.Look into all different kinds of funds before you jump into a specific fund.

Investing your money in a Savings Account-Low Risk
The most appealing thing about a investing or placing your money into a savings account is security.The interest rates are low, thus making the rate of return low (between 1-3%), but the security of having the U.S. government behind the bank is very appealing.The fact that the government will guarantee that the bank cannot lose your money makes a savings account very appealing.Usually the only fees associated with a savings account are minimum balances, and transaction fees, which may vary according to each bank.

Investing in your own business
Investing money into your own business is another way to make money.Depending on the type of business you invest your money in, will obviously depend on your rate of return.Buying a franchise can be a little safer than starting your own business because consumers are familiar with franchises.And when consumers are familiar with your business, you will bring in more money.Starting your business can also give you a large return rate, but you may need to be very patient to see it happen.In the beginning it is very difficult to bring in as much money as you are initially spending.Investing in your own business has risk with it also.You can be very successful, or lose everything.

There are many different mathematical formulas for making money, or should we say many different variables.You decided where to invest your money.Are do you want to play it safe with your money?It's up to you really.