You may be tempted to dump money in your savings bank account, to secure your future. This is not a good idea. Savings bank accounts give you very less returns, compared to investments made in bonds, fixed deposits, stocks and mutual funds. If you want to be financially independent, the first thing you have to do is start investing. After you invest your money, you have to monitor the progress of your investment and stay invested for the long term. Here is some good advice to invest, spend and save better.
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You should always invest your hard earned money, in the investments you are familiar with. If you invest your money in financial instruments you don’t understand, just because it gives a quick profit, you are taking risks in the investment. Invest in financial instruments you are familiar with, can understand and bear the risk it entails.
How do the rich citizens in India spend their money? The rich invest their money and spend what is left, while the poor spend their money and invest what is left. If you want to get rich soon, you should always spend what is left, after saving and investing.
It is better to go supperless, than rise in debt. Borrowing more than you require, is like knocking on the doors of poverty. If you want to be financially independent, never borrow more than you need.
Making a family budget is the best way, to be never out of money and save enough for life’s goals. You need to write down all your income. Make a list of all the money you spend. This helps you to control spending and get a grip on life.
Before you invest your money, do your research. Understand the investment you are making and what you get from it. Study the risk in your investment and find out if there are any hidden charges. Use the internet and update your financial knowledge.
Let’s say you want to invest in stocks. Research the fundamentals of the Company, whose stocks you want to buy. Study the sector where the Company operates and the economy in general. Yes…Managing money can be difficult, if you do not know, how to handle money. Follow these simple tips and soon managing money should be easy. Be Wise, Get Rich.
Under : Financial Planning