Investments Made Easy: A Simple Guide to Savings, Index, and Mutual Funds

Salaam African Bank: Investments Made Easy- A Simple Guide to Savings, Index, and Mutual Funds

Investments Made Easy- A Simple Guide to Savings, Index, and Mutual Funds

If you have any significant amount of money that you know you won’t need to spend for a few years, you likely want to invest that money so that it works for you to increase in value while you don’t need it. You also know, however, than investments are risky — you could win big and make money with very little work, or you could lose your initial investment just as easily. Investing can be extremely complicated, and most of us don’t have the time or the inclination to study the market and carefully manage an investment. Luckily, you don’t have to. Here is a basic breakdown of the three main choices when it comes to investing your money without managing your own stocks.

Savings Accounts

Although not typically viewed as an investment, a good savings account meets all the criteria. When you don’t need to spend your money right away, you can put it in an account and essentially lend it to the bank in exchange for a higher profit margin. Over time, you will turn a modest profit. Savings accounts tend to be some of the lowest yielding investments, but they are extremely safe. You do not stand to lose your initial investment, and you can also access your money and make withdrawals at any time and with little to no notice. The balance does not, however, increase to match inflation.

If you don’t need the advantage of liquidity and won’t need to withdraw your money for some time, you can opt for a Certificate of Deposit, which offers the same safety along with higher profit margins in exchange for restricted access to your money for a set period of time.

Index Funds

If you want a higher return on your investment and to keep pace with inflation, you must also accept the higher level of risk that comes with buying stocks, or shares in ownership of a company. Linking your financial future to the market value of one or several specific companies is the most volatile option, and may result in both great gain and great loss.

You can, however, invest in stocks for a more modest return and much less risk with an Index Fund. And Index Fund spreads your investment out across the entire market by buying a representative sample of stocks. This means that if any one company does poorly, your own investment will not go down with it. Your returns will be tied to the overall health of the market, which almost always increases over long enough periods of time.

Actively Managed Mutual Funds

Actively managed Mutual Funds are Index Funds that are carefully curated and overseen by an expert who actively chooses which stocks make up your fund at any given time and makes trades according to their best predictions of the market. The goal is to outperform the market, resulting in higher gains for their investors. Of course, there can be no guarantee that these goals will be met, and even the experts are sometimes wrong, resulting in higher losses. Because the funds are actively managed, they also charge larger fees.

5 Reasons You Need a Credit Card Today

Salaam African Bank: 5 Reasons You Need a Credit Card Today

5 Reasons You Need a Credit Card Today

Everyone manages their money differently, and the modern bank should allow you the freedom of many options when it comes to personal finance. There are some excellent tools, however, that should be part of almost every personal finance plan. Credit cards are one useful, versatile piece of most responsible plans, and can offer many advantages even if they aren’t your go-to for every purchase.

Convenience

The most obvious reason to carry a credit card is convenience. They are faster to use at the check-out counter and only require you to carry one item rather than assorted bills and heavy coins. Most importantly, credit cards give you the freedom to buy what you need when you need it, even if you don’t have access to the money until later on.

Emergencies

There’s nothing worse than being caught unprepared in an emergency. Whether it’s an unexpected medical bill, housing or car repairs, or even getting lost in an unfamiliar place, there are bound to be moments in all of our lives where we need some immediately available funds to help us out of a scrape. At that moment, it is extremely wise to have a credit card on hand to get you through the emergency.

Protection

Credit cards are a considerably safer way to carry your money with you than cash. If you wallet is stolen, you won’t lose any money that you can’t get back! A quick call to your bank can freeze or cancel the card and replace it without any trouble or loss to you. If somehow your card information is stolen and fraudulent charges are placed on your account, your bank will help you fix the situation and protect your savings. In most cases, you will be entirely protected from the theft and not held responsible for the theft, a luxury which you could never achieve if your cash was stolen.

Easy Records

If you use a credit card for most of your purchases, recording your finances is a breeze. You bank will keep an automatic list of all charges placed on your card and who you paid. Gone are the days of saving giant wads of receipts and sifting through complicated lists to keep track of your finances or build a budget.

Building Credit

Building good credit is easy when all it takes is using your card for your day to day shopping. It makes great sense for the purchases you are already making to work for you and help build strong credit that will save you money in the future. Thanks to the smart use of a credit card, you could save with better rates on mortgages, insurance, and other big ticket items like asset financing.
SALAAM African Bank offers great deals for credit cards that can help make your finances and your life go more smoothly. See our offers and decide for yourself!

Choosing the Bank That’s Right for You — SALAAM AFRICAN BANK

Choosing the Bank That's Right for You — Salaam African Bank

Choosing the Bank That’s Right for You — Salaam African Bank

There have never been more banking options that there are today. But with so many options to consider, it can be difficult to know which bank is right for you. Choosing the right bank depends on a number of different criteria. Yet the most important one might be finding a bank that helps you meet your financial goals.

Banking Experience and Location

If you prefer to bank in person, then you need to pick a bank with a lot of locations in your area. Otherwise, you won’t get the type of banking experience that you enjoy. You’ll also need to consider whether you want to walk, take public transportation, or get in your car to visit the bank. Traveling thirty minutes across town to deposit a check or speak with a banker in person isn’t very convenient. World-travelers need to make sure they choose a bank with locations throughout the globe. Having easy access to money makes traveling a lot less difficult.

Hours

If you work during the day, you’ll need a bank that is still open when you leave work. Many people prefer to do their banking on the weekend. Not all banks offer weekend hours, so make sure you pay attention to this detail if you prefer weekend banking.

Online Banking

Online banking is a very popular option, and it seems to become more and more popular as each year passes. Many banks offer their patrons the ability to deposit checks online simply by taking a picture of the check with their phone. Today, almost everyone has a phone which makes it easy to keep track of banking information via an app. Online banking also makes it easy to transfer money between accounts.

Fees and Rates

Every bank has different fees. Some have monthly maintenance fees just for having an account. Some charge you every time you use an ATM that doesn’t belong to the bank. All of these fees add up, so read the fineprint before depositing your money. If you want to open a savings account, pick a bank with high-interest rates. In some cases, it’s a good idea to use an online bank for your savings. Online banks can offer high-interest rates because they don’t have to spend money on physical locations and tellers.

Services

Do you plan on purchasing a house, starting a business, or getting a credit card? If so, you’ll need a bank that can offer mortgage loans and business loans. Not all banks offer these services. Small, community banks typically offer limited services while large national banks have the ability to do more for their customers due to their size.

Whatever bank you decide on, don’t just pick it because it’s the closest one to your home. Location and convenience are important, but there are so many other factors that you need to consider. If the bank that’s nearest to you just opened a month ago, it might be a better idea to go with a more widely-known institution that’s been in business longer. Do your research, and you won’t have to worry about your money.