Wise Decision : Invest Your Savings

piggy bankThis is what you do with the savings you have been accumulating. No fund should be left idle. Your money must to be working for you. These savings could be invested in share/equities or real estates, deposits and commerce. Good enough, these avenues of investment can be started with minimal amounts. There are many books on this topic and I suggest you get hold of the good ones to read.

Before investing, you must first determine the type of investor you are. Are you a high, medium or low risk taker? Depending on your temperament, some investors are great risk takers while others are not.

The timeless success principle says, “Life is nothing more than a game of numbers – the more risks you take, the more rewards you will receive.” Or in the words of Sophocles, “Fortune is not on the side of the faint hearted.”

Therefore, your risk level determines your investment vehicle and your investment vehicle determines your income. Remember, the higher a risk, the more income you can make.

Take a wise risk, otherwise later in life, when you are spent, your greatest regrets and sadness will usually be from all those risks that you did not take, all those opportunities you did not seize and all those fears you did not face.

The real secret of abundance is to spend less time searching for security and to spend more pursuing opportunities. You will win some and lose some. But failure is nothing more than learning to win.

Secondly, you have to acquire knowledge in your area of interest. This means that if you are interested in buying shares, then you must seek knowledge in the stock exchange. The same goes for any enterprise you wish to embark upon.

Sun Tzu in his book ‘Art of War’ said,

“If you know yourself, you need not fear the result of a
thousand battles.”

“If you know yourself but not the enemy, for every
victory gained, you will also suffer defeat.”

“If you know neither the enemy nor yourself, you will
succumb in every battle.”

The first sound principle of investment is security for the principle. Therefore read and educate yourself on the investment vehicle of your choice.

How To Erase Debt

eraseBecoming financially prepared for the future involves getting rid of debt. Many consumers wonder how much debt should be kept – and the answer is that if your debt is under thirty percent of your credit limits, than you are probably okay. Any number higher than thirty percent can seem to loom over your finances making every payment seem like a payment to the dark side.

To boost the health of your finances it is important to erase the debt that could so easily take over your finances. Here are some tips that you can use to erase the debt that you have accumulated.

Pay more than the minimum payment. Paying more than the minimum payment guarantees that a high amount of the payment will actually reach the principal of the credit card, as a significant portion of the minimum monthly payment is designed to cover the interest payments that have accumulated from the balance.

Create a budget that includes fifteen percent of the income for debt repayment. If fifteen percent of the income is allocated towards debt repayment, the consumer can easily repay their debt creating a repayment plan to get out of debt quicker than ever. It is important to realize that small sacrifices can be used to create changes within the budget that allow the fifteen percent for debt repayment to become easily attainable.

To avoid debt in the future use these tips:

Avoid using the credit card unless you can afford to repay what has been purchased within the same billing period. This can help to avoid interest fees, as purchases that are repaid within the grace period do not accrue interest. The grace period ranges from twenty to twenty eight days, depending on the credit card company that you deal with.

Don’t use buy now pay later plans. Many times, consumers will take advantage of these plans to save money in the present, but think about the money that will have to be repaid later! It is easy to forget that these payments are going to become due; therefore there are very few consumers that save for the funding of the purchase.

Live within your means. More than eighty percent of consumers are spending outside of their means and living above their income. This means that debt is used every single month to cover the shortfalls that exist within the income. The only way to truly avoid debt is to live within your means and if you cannot, than it is important to find alternate sources of income or lower the expenses within the household.

Establish a savings account. A savings account is often used as an alternative to debt and credit cards. A savings account is an essential way to prepare for the future and have this alternative to charging items or expenses that are required in the state of an emergency.

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