Considering investment minimums

Before you can begin to consider the investment minimums one thing that you are going to need to be aware of is what investments are, what kinds of investments there are, and what investment minimums are. The reason that you need to understand all three things is that they all work together to help you with investing and if you don't understand what a basic investment is then there is no way that you can know what investment minimums are. Not to mention that if you don't know about the different types of investments then how are you supposed to be able to find out if they have any investment minimums.

Let's begin with investments since pretty much everybody is familiar with the term investments because it is a way for us to get a return on the money that we have invested so that we can benefit from them sometime in our future. Investments are gaining popularity because of the fact that Social Security is nowhere near close enough for people to live off of when they retire, many people are finding out that they need to invest money into other types of investments just so they can survive when they retire. But investments don't have to be used to save money for your retirement, investments are just a great way to earn a return on your money, meaning you will end up getting more money then what you put into it, well at least that is what is supposed to happen.

Something else that you need to know about investments is that every investment has a minimum amount that you are going to need to invest. What this means is that there is going to be a set amount of money that you need to deposit in order to make your investment. And if you want to keep your account open then there is probably going to be a minimum account balance as well, which means you are going to need to keep a certain amount of money in the account for it to remain active. So before you begin investing your money you should take some time to look into what the minimum investment requirements are for the type of investment you are considering.

Here is a look at some of the different types of investments.

- 401K - this is probably the most popular type of investment because the money is taking directly from your paycheck and you never realize it is missing. Also many companies will match a portion of what you are investing to help build your account for your 401K; some companies will even allow you to roll over your investment if you switch jobs.
- Life insurance - this type of investment is actually quite popular, what you are doing is paying a certain amount to maintain the policy each month and if something happens to you your family will be able to collect on the policy that you paid for which can help to cover numerous costs and expenses that your family can incur.
- Stocks - this type of investment usually yields a bigger return because there is a higher risk with investing in stocks. With stocks you are basically taking partial ownership of a company, how big of a part of the ownership you have depends on how many shares you own. While this is a high risk investment, some are higher than others; it is a good investment because of how big of a return you can get on your income.
- Bonds - these types of investments are basically promissory notes form the government or a private company and with the bonds there is little risk that you are going to lose your money. Basically how bonds work is that you are loaning a set amount of money to a company or the government and they agree to pay you back that amount of money plus interest on a certain date in the future.
- Mutual funds - with this type of investment one person manages the money of several investors and invests that money into various stocks so that the effect of a loss will not be as bad if a loss does occur. Mutual funds are considered a safer investment than stocks because of how small the effect can be if a loss does occur, but you also don't get as high as a return on the money that you are investing either.
- Money market funds - this type of investment is great for a short term investment strategy. How you earn money with this kind of an investment is that you are considered an independent shareholder so you earn money from the investments that you make into the money market funds.
- Annuities - this type of an investment is an agreement between you and the insurer and works to produce income for you and protect your earning potential; many people receive an annuity when they retire. This type of an investment is a tax deferred income which means that the money you put in is not taxed, but it will be taxed once you take it out. There is usually a time limit on this income and if you withdraw it early you will be paying higher taxes.
- Brokered Certificates of Deposit - this type of investment is similar to a savings account but with CDs what you are doing is depositing money into an account for a set amount of time. The longer you leave your money in the account the more of a return you are going to see on your money. But one of the best things about CDs is that even if you do take your money out early you are not going to be charged any penalties or fees for withdrawing your money.