There are so many ways to generate income in a struggling economy, finding which works for you best is a good start to managing your finances.

Side hustles are often the first option, but there are other ways of generating income, that require less effort and time, giving you more time to enjoy your investments.

According to Investment Analyst Ruan Marais from Salvo Capital (Pty) Ltd, side hustles generally refer to a job or project you work on outside of your “9 to five”, it also involves actively earning money by performing a service or selling a product.

Alternative income, on the other hand Alternative income requires an initial investment but can then generate money with little or no ongoing effort from you.

He added that alternative income, commonly referred to as passive income requires an initial investment.

These can include owning a rental property or investing in dividend stocks, “which are publicly traded shares of companies that pay out a percentage of the profits they generate to shareholders in the form of dividends,” he explained.

“The less well-known options of generating alternative income are investing in for example Private Equity or Hedge Funds.

Private Equity offers higher upside potential in certain instances but is also less transparent and generally higher risk investments than publicly traded companies.

Hedge Funds are usually a source of generating uncorrelated investment returns, or in other words, returns that are not dependent on the directional performance of public markets.”

His advice to locals who have never invested before is that they be aware that all investments carry some form of risk. “You must have a clearly defined goal for the investment,” he said.

Marais added that being patient throughout your investment period and the different market periods is an important part of being a successful investor.

“Make sure you will not need access to the capital you are planning on investing for other purposes.

Investing is different from saving, make sure you have a separate savings account to cover unforeseen expenses in order for your invested capital to remain unaffected,” he advised.

If you would like to learn more about investments and how you can manage your money to grow for you, read more on www.bloemfonteincourant.co.za for a checklist compiled by Marais with all the questions you need to ask before investing.

Gypseenia Lion