Tag Archives: money

Learn to invest in 10 easy steps

By Smart money, , ,

Investing is not as hard as it may seem. In principle you have to put the money to work for you so that you do not have to take your second job or work overtime to get more money. There are several types of investments that do not require large amounts of money to start investing.

Step 1. Put your finances in order. To start investing without looking at your financial situation is like jumping into the pool without knowing how to swim. Before you start investing, you need to evaluate your financial situation, know how much you earn, how much you spend and how much you can save to invest. Fortunately, you can start investing with relatively small amounts of money. The sooner you start to invest, the better your long-term results.

Step 2: Learn the basics. You do not have to be an expert in finance so you can invest, but you have to have the basics to make the best decisions. Learn what is the difference between the main financial instruments, shares, bonds, investment funds, deposit certificates, etc. You also need to know some basic investment principles such as asset allocation and diversification of investments to mitigate the risk and get the best results.

Step 3: Set your investment goals. Once you have found out what is the amount you have for investments and what are the basic notions you need to set your investment objectives. Although all investors want to earn money, your goals need to be more specific. Capital security, earnings, or capital appreciation are a number of factors to consider when setting your goals. What is best for you depends on your age, the moment of your life and your needs.

Step 4: Determine your risk profile. A decrease in the total value of your investments gives you the creeps? Before deciding what investments are right for you, you need to know how much risk you are willing to assume. Do you like car racing and amusement parks or do you prefer to read a good book in the quiet of your house? Your risk profile varies depending on your age, income, and financial goals. Find out how well you tolerate the risk before investing.

Step 5: Identify your investment style. Some investors prefer speculation while others prefer long-term investment. Once you have set your investment goals and risk profile, you need to see if the two are compatible. If you like racing cars, but you prefer capital security then it is better to tackle a conservative strategy. A conservative strategy involves investing in relatively low-income, low-risk financial instruments, while an aggressive strategy implies taking high risks to get high profits.

Step 6: Find out and understand the costs of your investments. It is very important to understand the costs of your investments because they can reduce your investment’s profitability. In principle, passive investments tends to have lower costs than active investments. Each type of investment has different costs. Before investing, be aware of all the terms and conditions that this investment entails in order not to have surprises later.

Step 7: Find a good consultant. To start investing, you need a trusted investment broker or consultant, with whom you can communicate very well and have professional experience and a good reputation. Establish some criteria that it has to meet and asks for recommendations. Schedule a meeting with him to see if he is the right person to guide you to the investment world and set the terms of your cooperation if you are happy with your choice.

Step 8: Choose the investments. Now you have all the elements to choose the investments that will be part of your portfolio. Depending on your investor profile and the consultant’s assistance, you can choose the investments that best suits your needs. To have a balanced portfolio, you need to diversify and allocate your assets wisely. With the asset allocation you will choose investments with different risk grades but also with different returns, from the safest to the least secure according to your risk tolerance. By diversifying, you will have a portfolio that will contain financial instruments from different categories and from diverse domains.

Step 9: Do not make emotional decisions. If you have not found out before, it’s time to know that emotions can negatively impact your investment. Do not let the fear and the greed to diminish your gains or increase your losses. Make an investment strategy and respect it strictly, otherwise emotions will influence your decisions and may be a greater enemy than ignorance. Greed can lead you to maintain a position in the hope that prices will increase even if the market is declining. And fear will make you sell a holding too early or keep a loss asset. If your portfolio does not let you sleep at night, it is best to reassess your risk tolerance to adopt a more conservative strategy.

Step 10: Evaluate and modify. The last step, as important as the others, on your investment journey is to evaluate and review your investments. Over time, depending on the evolution of financial markets, the structure of your portfolio will change, and you will need to make changes to it, to balance it again.

Start investing as early as possible and keep your interest in the investments you make. With time you will gain more and more experience and make wiser decisions.

7 things learned from the richest people in the world

By Smart money, , , ,

What can the richest people in the world teach you?
Very simple – probably you immediately realized – can teach you how to get like them. That’s rich.
Because we all have the ability to find our own way to prosperity. Only some have already reached “destination” …
You would be surprised to find that the richest people on the planet are not at all “super-humans”. In fact, they are not very different from ordinary people (obviously, if we do not take into account the size of bank accounts).
But they still have something special: a different way of looking at the world, which allows them to identify opportunities and turn them into a successful big business.

Here’s how they are structured and what the richest people in the world do:

1. They really like to do what they do.
They do not generally compromise, but they are pursuing a career in a field that really means something to them. In other words, they apply the “choose your profession, which will make you joyfully awake every day.” And if they do not find a job to satisfy their aspirations, then they invent itthemselves.
Due to the fact that the rich do only what they really like to do, they dedicate themselves to their work, continue to look for ways to develop their professional lives and do not waste their time on nothing.

2. Progressing permanently.
Whether it’s the latest advance in technology or a better way to communicate with their team, the very rich are constantly learning and keeping in touch with the newest directions of development to improve all aspects of life.

3. They are constantl ymaking  changes.
The truly rich often analyze the situation in which they are at one point and the direction in which they want to move and then make the necessary changes. Instead of being stuck in a company (or in a relationship) that does not really satisfy them, they prefer to go and look for better choices.

4. Getting totally involved.
They voluntarily dedicate their time and energy to those activities in wich they strongly believe. Very wealthy people always praise the efforts made by employees and truly appreciate those who work for them.

5. “Bad luck” is not part of their vocabulary.
The rich believe strongly that the notion of “bad luck” does not exist and that the situation they have at a certain moment is the result of the choices they have made in the past. They are involved in many positive things: doing physical activity, eating healthy, working hard and reading a lot. All this helps them identify new opportunities to earn money.

6. They ask many questions.
The very rich always ask questions and they are very good listeners. They are motivated by the desire to learn and understand the things that happen in the lives of other people. Some of their best ideas come from these conversations, because they really “listen”.

7. They do not have “wishes” but they set “goals.”
We often hear people saying, “I want to be rich,” or “I want to find another job.” The richest people have come to this because they have set some goals, not because they have made wishes.
Many of them set out each year an important goal they want to achieve. They do everything they can to avoid the loss of time, so they make daily lists of things to do wich they finish.

7 mistakes with money that rich people do not do + 7 tips

By Smart money, , , ,

One of the characteristics of successful people is that they know how to efficiently manage their personal finances and not make big mistakes with money.
But they were not born scholars.
They invest in financial education and thus understand how they can avoid the main threats and mistakes that stand in the way of prosperity.

Here are 7 mistakes with the money that rich people do not do and 7 tips:

1. DO NOT spend more money than they gain.
The main skill in money management is to spend less money than you earn. Some of the planet’s richest people have applied this principle in full.
For example, Sir John Templeton, one of the largest investors in the world, saved 50% of his income, even when he earned little. But if you save that percentage of income seems too much to you, it’s no problem. You can achieve financial success and save only 10-15% of your income, or even less.
Tip: Learn to spend less than you earn.

2. DO NOT focus on price, but understand the importance of value.
The price you pay for what you buy is just a part of the overall picture. Successful people also think about the value of the goods.
When investing, they consider the possibility of increasing these businesses. As far as personal things are concerned, they are always interested in the quality and lifespan of these products, not just their price.
Tip: Buy quality products that last for many years.

3. DO NOT throw money on interests and commissions, know how to manage bank accounts.
A credit card is very expensive because of the high interest you have to pay. Successful people are very careful about commissions, such as how much they pay for using the ATM or other transactions.
These commissions are easily avoided if you understand how the system works and you can choose a great bank account.
Tip: Review your account statement once a month, and you’ll understand the charges and fees charged by the bank.

4. DO NOT forget to adjust their financial plans after a major change in their lives.
Did you get married soon? Waiting for a child? These are a few important financial steps that successful people manage efficiently.
It is essential to make financial adjustments when the circumstances of your life and your family change significantly.
Tip: At least once a year, you should carefully analyze your life and financial plans (preferably with a financial specialist).

5. They are NOT satisfied with a fixed income but always seek ways to increase their income.
Some people will never ask for an increase in salary, or they will simply be pleased with a 1-3% increase. Unfortunately, such a rate of growth is lower than inflation, which means that it virtually reduces your purchasing power. Instead, successful people are constantly looking for new ways to increase revenue.
Tip: Go to courses that improve your professional training and try to contribute with ideas to increase the productivity of the company you work for.

6. They DO NOT claim to know absolutely everything about money.
Successful people know that the world we live in is very complex. When it comes to personal finances and money, there is a lot of information available. That’s why successful people like Warren Buffett know their limits and focus on their strengths.
Tip: Continually improve your knowledge of money and investment. If you have not done already, read the most important books in this area.

7. Do NOT take unnecessary risks.
Warren Buffett has remained famous because he said “the number one rule is never lose money.” But all types of investments have a certain degree of risk.
So successful people use two important tools to avoid losses. They understand the role of insurance (buildings, cars, life, etc.) to control certain risks, but also the great importance of diversifying investments.
Tip: If you are not too sure you understand how a certain financial instrument works, just act slowly and ask questions until you really get it.

The simplest and most effective 11 truths about money

By Smart money, , ,

About money, personal finances and how you can have a more prosperous life has been written a lot.
But if it were to make it as simple as possible, you would see that everything is reduced to just a few extremely effective ideas, because the Pareto’s principle applies to personal finances too: 80% of the positive results are obtained with only 20% of the efforts made.
So before complicating yourself with too many details, maybe it would be a good idea to consider those simple and effective things that will produce the best results.

Here are the simplest and most effective 11 truths about money that can bring you a more prosperous life:

1. Financial education is more important than money.
Be constantly preoccupied with learning about money: how to manage, how to invest and how to keep them. Day by day, you MUST be the “master” of the money and not the other way round. Once you understand how money “works”, improving your personal finances becomes just a challenge and not a stress.

2. Spend less money than you earn and save the rest.
You can get everything you want. Just adjust your earnings and expenses accordingly.

3. Do not try to impress with the things you have.
Only superficial people will judge you for the things you have. True friends and important people in your life, however, will judge you by your character.

4. You must start investing as early as possible – the younger you start, the more time you have to build your well-being.
If you start investing earlier, you will have more time to learn, gain experience, and recover your mistakes or unprofitable investments.

5. There are “good” debts and “bad” debts, be careful not to confuse them.
If you use a credit to buy properties or goods that bring you income and whose value increases over time, then this is a “good” debt, because it will help increase your prosperity.
But if you make credits for consumption, they will make you lose money because of the interest you pay and the depreciation of things bought, so they are bad debts. Although the two types of loans seem quite similar at first glance, they are actually very different and have opposite effects: one brings you money and the other takes them out of your pocket.

6. Live simply and surround yourself with positive people, not things.
The more you fill your life with things, the more they will consume more time and energy. The more “toys” you have, the more you have to pay and maintain, and in the end you will be less free. Instead of being the owner of these things, they will come to rule you. Just live simply and makes wise decisions.

7. Be always prepared for unforeseen situations, both financially, physically and mentally.
Make a plan, organize yourself and put aside some money for such situations.

8. Nobody takes more care of your money than you.
You do not have to have 100% confidence in someone else’s opinion about the value, profitability or safety of a particular investment (or business) than after you have studied the subject yourself and made the calculations.

9. Think long term and plan your future.
Learn to postpone the rewards you are tempted to give you right away. Weigh carefully all the important financial decisions you have to take. The future will arrive sooner than you think and you are the one who will bear the consequences of the decisions you will take.

10. Do not treat the money superficially and do not waste them.
You have to treat the money as you treat a good friend: with respect and gratitude, because once you have maked them, you must take great care to keep them.

11. Trust yourself!
Learn to listen to the “whispers” of your self and give them more attention than to the “cries” of your ego. You have the opportunity to create the life you want. You are never a victim of circumstances. You have the power to control your thoughts, actions and perspective on life.

Be optimistic and always look at the good side of things!

20 easy ways to help you save money

By Smart money, , , ,

We all have the temptation to see the pessimistic side of personal finances. We say that we do not get enough money, but we never think about the expenses we make and whether or not they are justified.

“I can not manage with the salary I receive! I’d like to save some money, but I can not do it! After I pay the rate to the bank, I only have money for the strict necessity! What is your secret, how do you save money?”

Let’s make a “battle plan” together. Below I made a check-list with ways you can save. You can check the things you already do. Those left unchecked, you can test them to see if they work for you.

Therefore:

The first thing you have to do is plan your monthly budget. Make an Excell document to include your spending over a month.

On a column, you can pass on utilities – maintenance, electricity, cable TV and internet, mobile and fixed telephony, etc.
Another column belongs to the current expenses:
– food;
– baby related expenses: milk, diapers, clothes, medications, kindergarten expenses, school etc.
The third column is assigned to occasional expenses: city exits, wardrobe renewal, household goods acquisitions, etc.
A fourth column is for travel expenses: fuel costs, car maintenance, public transport subscriptions.

After a month, you’ll be able to see exactly what your salary is doing and if you have had extravagant spending.

20 easy ways to save money

1. Always make at home a shopping list when you go to the market! Even it may be tempting to “derail”, try to stick to the plan.

2. Never buy more than you can eat! Did you know that up to 48% of all food purchases go to the trash?

Translation: There are real chances of wasting up to half of your food budget, if you loose yourself on the waves of shopping!

3. Hunt Hypermarket Offers! Very seriously: did you know that big stores have every day serious discounts on different foods? You can benefit from price reductions of 25-30% if you carefully look among the shelves. If you go shopping in the evenings, you can find even 80% discounts for foods whose stock is in the end or that did not sell well throughout the day.

4. Go to the market for vegetables and fruits! Usually, prices are much lower than those in the Supermarket. In addition, from April to October, buy seasonal fruits and vegetables. It’s cheaper and healthier to eat vegetables and fruits in the hot season than to buy them in the Hypermarket at winter at exorbitant prices.

5. Cook in the house with your loved ones. Besides the obvious financial benefit (it costs more to eat at the restaurant, fast food or in the cafeteria), you will spend quality time with family and have fun.

6. I know it’s not a novelty – you probably heard this: try to save water, close the light in the rooms you do not stay in, do not let the air condition go without need, and during the winter, do not waste the heat.

7. During the week, prepare your lunch pack from home. Avoid eating at the cafeteria or restaurant or ordering take-away.

8. Consult online shop offers if you plan to purchase electonic products. You will find out where you can get the best price for the desired product. In addition, you’ll find plenty of reviews about it and find out how well it fits your needs. At the same time, you can find more suitable alternatives, offered by users like you, who have tested them before you.

9. Do not use a credit card! It’s a product that just gives you the illusion that you can buy more. Finally, the maturity will come and the amount will have to be covered in some way. And interest can also reach 25-30% per year. In addition, any credit card has a fairly steep annual administration fee.

10. You can make a debit card, through which you can get various discounts on shopping. However, it is a good idea to make your calculations before: this product has administration costs. Thus, if the total value of discounts does not substantially exceed that of administration costs, just abandon the idea.

11. Use discount sites to buy vouchers for various entertainment in town. With a little attention, you can save each month an important amount and, at the same time, you will have a rich social life.

12. If you want to renew your wardrobe, go shopping during rebate periods at season change. You can save, even 50% of the price of the product. I recommend that you carefully study the market in advance to get a real benefit from your purchase.

13. If you have small children, try – as much as possible – to borrow cribs, trolleys, toys and clothes from friends or relatives who had small children or buy them second hand on websites where you can see exactly what the status of the product is. By the age of 12, children change clothes every season, so you will waste a lot of resources if you buy new clothes every 3 months.

14. Discard your fitness subscription, reduce car journeys and walk more or use a public transport. You will save gasoline, will make more movement and thus you will also gain in Health. If you still have to drive, I recommend that you try to solve more things in one trip.

15. Choose to go on holiday at the beginning or end of the season. It costs considerably less than a full season stay. Early book your holidays – you can pay 40% less if you book your tickets from November or December for the next summer! You can also opt for a last minute offer, but here you have to know that you will not always be able to choose the destination of your dreams. In addition, if you notice that a particular hotel has too many available places at the last moment, it may be that the offer hides some problems.

16. Quit smoking! You will literally win years of life, health, and a pack of cigarettes in minus a day will bring you considerable savings.

17. Try to prepare your coffee at home and avoid coffee machines.

18. If you are addicted to gadgets, make a serious calculation of the expenses that this custom generates over a year. You may have an unpleasant surprise …

19. Optimize your bank charges! If you have active accounts with multiple banks, you can choose to close those that are not absolutely necessary. Ideally, you can stay with one account, from which to handle by internet banking all operations, including paying utility bills. Any additional account opened with another bank will incur administrative fees.

20. Do not make personal loans unless it is absolutely necessary. In addition to interest, you will also have to pay a whole series of commissions and, instead of saving, you’ll spend.


Try to save money through the above methods and it is very possible to discover that you will be able to purchase the desired product or make an investment only from your savings.

 

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