Now what, step 2

Following my discovery of the need to be financially aware and do something about my pension, I took the first step of getting rid of some of my mortgage.

Which is good and saves some money every month. But it does not generate any income. Only when I sell the house the money becomes available again and that’s not something I want to do.

So I was looking for a way to get some of my savings directed at some form of automated income. Luckily there is the internet.

Looking around at the internet I found a few options to do so. First there are ETF’s , dodgy sounding those 3 letter shorts. Looks like loosing your money.

Well that’s actually not the case. An ETF is an Exchange traded fund, which exactly follow’s an underlying market or part of an industry or commodity. Or some other combination.

They are reasonably cheap and there are ETF’s that follow dividend paying company’s. Which is interesting since I am looking for a way to generate income in the future. There are a lot of ETF’s and company’s offering them. One of the bigger ones is Vanguard . Which offer dividend ETF’s.

Another nice thing is that you don’t have to worry about knowing which company’s you want for your investment portfolio, that’s all being done for you. And they are relatively cheap. You can simply buy a few every month and watch how it goes.

Another possibility is too invest in company’s yourself. There are a lot of investment method’s but from what I read so far , Dividend investing is very suitable if you want to generate an income from your investments. You are trying to figure out which company’s have been giving out dividend’s for a considerable amount of time. And are solid enough to keep on doing this for the foreseeable  future. And of course  don’t cost an arm and a leg.

The downside of this strategy is it requires way more thinking on my part and it costs more in terms of fees when buying the shares. And more starting up capital.

It can be a hobby, could be fun. For now I choose ETF’s and will see how that plays out. In the meantime I am reading up on dividend investing and general investing stuff, while listening to some good music.

Keep you guys posted.