Saving on little everyday things is a good smart money tip. However, what should you do with all the savings you have made? A smart money user will learn to invest it wisely to ensure that their savings continue to grow and is not eroded by inflation.

There are many means of investing money, depending on your risk profiles. If you are a high-risk investor, you might choose to invest in something that appreciates quickly like property or stock options. Just be warned that there is always no returns without risk so do be careful to do lots of research before you invest in something risky and learn not to be swayed by the marketing language. Always, always read the fine print! For something less risky, read on after the jump!

Most of us tend to fall in the medium to low risk profiles and in uncertain times such as this, where the share market is extremely volatile, it may be best to look towards fixed deposits as an investment tool. Interest rates have been low worldwide for quite a while already and the US fixed deposit interest rates barely nudge about 2% per annum. The recent times of inflation and general economic downturn has seen interest rates starting to climb. I recently saw this advertisement by RHB Bank:

They are offering up to 4.5% interest for a term deposit investment! The fixed deposit interest of 4.5% p.a. certainly sounds tempting but remember, it involves locking up your money and all potential opportunities for 19 to 24 months which is a whole long two years!

So always weigh your options and consider your money needs carefully before you decide to invest. It’s your first step towards being a smart investor!