Before we can identify what a wealth creating investment is, we need to clearly define wealth. Wikipedia defines wealth as “the abundance of valuable financial assets or physical possessions which can be converted into a form that can be used for transactions”. This could refer to ownership of stocks, bonds, land, property, precious metals, cash or any other kind of asset.
The basic premise of investing is to acquire assets that will increase in value over time. This increase in value is what will aid in your wealth building goals. Now simply gaining ownership of assets is not going to build wealth on its own. You of course have to be a good steward of those assets. You have to understand how they fit into your life and how to manage them in an effective way.
There are many things you will want to consider before investing, regardless of the market. Is this a safe investment? What is the purpose of the investment…are you looking for short-term returns, additional income or the slow and steady creation of wealth?