Banks often offer products that ask investors to lock their money away for one, three, or five years. But if you want to get the best returns possible, giving your money to someone else to use for ten years could be the best option.
Long-term loans are really what makes Western civilization possible. Practically every major project is utterly dependent on them: everything from rail lines to skyscrapers.
There’s just one catch: the number of people willing to give up their money for such a long time is small. Eventually, people get to the point where they feel it’s just too risky, or they want to enjoy their money now.
But the question is really a personal one. Only you can understand whether it is worthwhile handing over your money to someone else to manage for a time.
If you’re still stuck, this post is here to help. We take a look at the various factors you’ll want to consider before committing to any long-term investment horizon.
Table of Contents
Consider Your Age
The first thing you’ll need to look at when considering whether 10 years is too long to lock away your money is your age. The older you are, the less sense it makes, because you’ll have fewer years to enjoy the spoils.
You’ll also need to consider health risks. The older you get, the more likely you are to experience conditions that might adversely affect your ability to enjoy your money.
Younger people often have significantly longer time horizons. Many who start planning in their twenties won’t experience the benefits of their actions until they are in their seventies, over fifty years later, which is why locking away their money and even investing in gold from the ABC Refinery, may make more sense for them.
Consider Your Health
As a side note, you’ll also want to consider your health. Even if you are young, you might have a condition that could limit your life in some way, preventing any additional money you could gain by waiting not to mean a great deal to you.
Again, you’ll want to talk to your doctor about your state of health and whether you will be in a good place in ten years’ time.
Consider The Returns
Another deciding factor will be the returns you make. The higher the returns on 10-year securities, the more beneficial they are and the more sense it makes to lock away your money.
NGS Crypto reveals that returns in the crypto space are exceptionally high. Some investors can earn up to 16%, according to its metrics.
Consider The Risk
You’ll also want to consider the risk of putting money away for more than 10 years. Anything could change between now and 2033.
For instance, we could see tremendous upside. If AI delivers on its promises, the world will change unrecognizably, economies will likely grow, and wages will rise.
The downside, on the other hand, could be secular stagnation in the economy, a sense a recession is underway, or something even worse. Again, you’ll need to divide if you want to tolerate these kinds of risks. If you can’t, then shorter time horizon investments might be better.
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