The word “invest” is thrown around alot, but there are tons of ways you can invest your money.

Here are a few examples:

- Real estate, such as buying a property and renting it out for income.

- Guaranteed Investment Certificates (GICs), you can buy these at any bank, it’s where you agree to lock in your money for a set period of time, in exchange for interest. For example, as of Oct 21, 2023, Tangerine Bank is offering a 5.7% interest rate for 1 year GICs (this is not an affiliate link, I just want to show you an example of a good GIC, and I personally am a big fan of Tangerine Bank, they’re a digital bank owned by Scotia Bank). This means that you could buy a GIC for $1,000 and after 1 year you’d have $1,057. GICs are a good option but traditionally have lower rates than the stock market. Although, right now, rates are exceptionally high.

- Mutual funds, this is where a mutual fund manager picks how to invest your money, it’s usually in bonds and equities (stocks and ETFs). With mutual funds you usually have a dedicated advisor that is your go-to contact for questions about investing, mutual funds are popular because of this. The downside is that the fees for the mutual fund and/or advisor are usually between 1-2%. That might not sound like alot, but if you invest $500 a month ($6,000 a year), earning a 5% rate of return, paying a 2% mutual fund/advisor fee, then after 30 years, you’d have paid $124,549 in fees, and have $294,016 leftover from your investment.

- Stocks, alot of people lose money in the stock market, and it’s usually for 1 of 2 reasons:

1. they stock pick, which is when you select individual stocks. If you do good research and make good picks, this can be lucrative, but alot of people make bad choices.

2. they let their emotions take over and sell at the wrong time. You’ve probably heard, buy low, sell high. In theory, it sounds like common sense and easy to do, but the reality is that when you have all or a portion of your life savings in the stock market, and it crashes, seeing your money go down and down over days and weeks is very difficult, and alot of people panic and sell when things are down, resulting in them losing money by locking in their lose.

- Exchange-traded funds and index fund investing, you may have heard about index funds, the S&P 500, and ETFs. These are by far my favourite investment type. ETFs are like buying a basket of stocks, so instead of hand picking stocks and not knowing if you’re making the right choice or not, ETFs allow you to buy hundreds or thousands of stocks easily. That’s where the S&P 500 comes, in with a ETF that tracks the S&P 500 (meaning it invests in the largest 500 US companies) you’re investing into all 500 companies, so if a few of them perform poorly or even go bankrupt, you’re literally not putting all your eggs in one basket.

There are many more types of investing, but I’m a big proponent of exchange-traded funds and index investing, and have the majority of my net worth invested in that. In the next step of my guide, we're going to talk about "how" you can get access to actually invest in these kinds of investments.