Investments are a great way to ensure that you have a steady income aside from what you earn at a nine to five. They also allow you to obtain returns and a constant source of income once you’ve retired. So, if you’re looking to invest but are unsure where to start, here’s a quick guide that will help you understand the different types of investments.

Stocks
When you hear the word investment, it is customary to associate it with the words "stocks" and "stock markets." This is because they are a popular and simple mode of investment. You can buy stocks or shares of stocks in a company. Buying stocks means purchasing a stake of the ownership in a publicly traded company, such as Apple or Facebook. The idea behind investing in stocks is buying part ownership (stocks) at a specific price, hoping that the price will eventually go up, post which you can sell it for a profit. Of course, the risk to this is that the purchased stock price could also go down, meaning you would lose money instead of making it.

Bonds and securities
Bonds are a form of loan where the investor loans out a certain amount of money to the corporation or a government for a certain period under a fixed interest rate. Bonds are typically low-risk and are usually considered to be among the safest investment plans. Individuals can opt to pick a bond either with the government or with a corporation. Choosing the government is almost risk-free, whereas corporate bonds carry slightly higher risk factors, as there is the probability that they would default on the loan. The downside of the bond is that it may not always have the same buying power when you receive the money after the stipulated period. This is because the money does not catch up with the rate of inflation.

Mutual funds
Mutual funds are a type of investment where you give your money to a broker or money manager, and they make the investments for you to make money. The idea behind it is to pool money before making a significant investment in a stock or bond. However, mutual funds are low-risk considering that your money has been diversified into different stocks and bonds. But this also means that the returns are lower than other high-risk investments. You can only make money from the dividends (profits of the stock) and the bonds' interests.

Retirement plans
A retirement plan is another excellent way to ensure that you have a steady source of income in your older years. Retirement plans include workplace retirement plans, individual retirement plans, or traditional retirement plans. Workplace retirement plans are usually the 401(k) plans and the 403(b) plans. If your workplace does not provide retirement savings, you can always opt for an individual retirement plan (IRA) available at various financial institutions.

Cash and commodities
Another way to invest your money would be to put it in cash and commodities. This is usually considered a low-risk investment type, and it's best for someone who wants to avoid risk. You have the option to chose from different commodities, such as gold, silver, and platinum. While this is an ancient practice, it is crucial to note the price of these commodities can vary based on the political scene and environmental changes. Also, note that prices of commodities can fluctuate based on the scarcity of gold. If commodities are scarce, the price will go up. If they are in abundance, the price will drop.

Real estate
There are many ways in which you can invest in real estate. You can opt to purchase an apartment and rent it out; you can buy homes, flip houses, or even buy trailer parks if you have the means to do so. Note that investing in real estate typically means you need to have a significant investment sum ready, as homes and apartments can be pretty expensive. Real estate investments are generally great and have low risks, especially if you do your research right. You can also choose to put your money in a Real Estate Investment Trust that works similarly to mutual funds.