Do you know the difference between good debt and bad debt ?
Do you know how to make debt work for you ?
The wealthy know the answers to these important debt issues, you should too !
Bad Debt
Bad debt is defined as any debt that you incur to purchase something that you do not receive an income from. Most consumer debt falls into this category.
Credit cards, car loans, lines of credit, even most mortgages fall into the bad debt category.
Good Debt
Good debt, yes you probably guessed, is any debt that you incur to purchase an income producing asset.
Investment loans, brokerage loans, mortgages for investment properties, etc. fall into this category.
Kill Your Bad Debt
When it comes to building wealth, the key is to eliminate (or kill) all of your bad debt. You cannot possibly get rich if you have to continually carry around the ball and chain of bad debt. Your income will continue to make someone else rich, namely your bank or other financial institution. Not a good plan.
To kill bad debt, you can either pay it off with a repayment plan or find a way to convert your bad debt into good debt.
Repayment Plan
For most, unless you already have liquid investments, this will be their only option for killing bad debt. Start by identifying which of your debts incurs the highest interest rate. If you have credit card debt, this is normally where you start. Next, proceed to the next highest rate and so on.
To free up funds to put towards repayment, you will likely have to make sacrifices to your lifestyle or increase your current income level. Either way, it will not come without some pain. Motivation is the key in any debt repayment plan. It will take time and commitment.
Turn Bad Debt to Good Debt
If you already have investments that are liquid (easy to turn into cash) and will not incur a lot of income tax if you were to cash them in, it may be best to look at this option for killing your bad debt.
First, cash in all of your investments that fall into the above category. Second, use this cash to pay off all of your bad debt. Third, obtain a new loan for investment purposes. Fourth, use the borrowed funds to buy back your previously cashed in investments.
This will in effect turn your bad debt into good debt. The big advantage of this option is that in many countries, you will now be able to "write off" your interest payments as an investment expense on your income tax. This can be a significant amount, especially as your income increases.
The key for this option to work is that your investment income or expected gains must be greater than the interest you will be paying on the loan. Check with your local adviser before trying this option.
R. I. P.
Both of the above options could be used together to ensure your bad debt is killed and hopefully will never resurface from it's ugly grave. Motivation and determination to improve your financial life will be absolutely necessary to achieve this ultimate goal.
As always, I welcome your comments and suggestions for future topics.
Tuesday, October 16, 2012
Tuesday, October 9, 2012
How to Get Rich - Secure Your Main Income Stream
Are you worried about losing your job ?
Are you worried about what will happen if you are unable to pay your bills ?
If you are, you are not alone ! This is one of the top financial concerns of individuals today !
Your Main Income Stream
Chances are if you are like most people, your job is your main source of income that you rely on to pay your bills and have a little fun. The reality is, even if you take the necessary steps to become wealth, you are going to need a job for quite some time yet. This means that you had better enjoy what you are doing and take the necessary steps to protect your income.
Enjoy Your Work
Many people I have talked to hate their jobs. My advise for them is to find a job or career that they can actually enjoy or at least not absolutely hate. This will not only make their life much more tolerable, but they could actually be seen by others to actually like what they are doing. This could create interest by their current boss and actually lead to advancements etc. Grumpy employees generally do not get very far.
It is therefore in your best interest to be liked by your superiors and may prevent you from being the first one to be laid off if tough times are ahead. If you don't like what you are doing, find something you would like to do. Life is too short not to.
Add Value to Yourself
Your goal in any job or career should be to position yourself to be the last one to be laid off. In order to do this, you must give your employer a reason not to consider you for a layoff. If you can work towards being the most valuable employee in the organization, this will certainly help. Be the best at customer relations. Be the most punctual and reliable employee. Do a little more than what is required. Etc. etc. You get the idea !
Adding value to yourself will also make it easier to get a good recommendation some day if needed for another job or career position. This is basically your best insurance from a life of poverty.
Be Prepared for the Worst
Even doing all of the above does not guarantee you will not someday be the victim of a layoff. Many things can happen that are totally out of your control. A company could go bankrupt. Governments could change policies that eliminate your job. Etc. etc. You therefore need a financial buffer to help through a potential layoff.
Many call it an emergency fund. Today, I call it a survival fund. I recommend saving an amount equal to three to six months of your committed expenses. Keep this amount somewhere where you can't easily get at it such as a savings account with no bank card access.
By following the above suggestions you should be able to prepare yourself as much as reasonably possible for a possible disruption to your main income stream. Nobody knows for sure what the future will bring, but we can take steps today to help limit the damage should trouble arise.
As always I welcome your comments and suggestions for future topics.
Are you worried about what will happen if you are unable to pay your bills ?
If you are, you are not alone ! This is one of the top financial concerns of individuals today !
Your Main Income Stream
Chances are if you are like most people, your job is your main source of income that you rely on to pay your bills and have a little fun. The reality is, even if you take the necessary steps to become wealth, you are going to need a job for quite some time yet. This means that you had better enjoy what you are doing and take the necessary steps to protect your income.
Enjoy Your Work
Many people I have talked to hate their jobs. My advise for them is to find a job or career that they can actually enjoy or at least not absolutely hate. This will not only make their life much more tolerable, but they could actually be seen by others to actually like what they are doing. This could create interest by their current boss and actually lead to advancements etc. Grumpy employees generally do not get very far.
It is therefore in your best interest to be liked by your superiors and may prevent you from being the first one to be laid off if tough times are ahead. If you don't like what you are doing, find something you would like to do. Life is too short not to.
Add Value to Yourself
Your goal in any job or career should be to position yourself to be the last one to be laid off. In order to do this, you must give your employer a reason not to consider you for a layoff. If you can work towards being the most valuable employee in the organization, this will certainly help. Be the best at customer relations. Be the most punctual and reliable employee. Do a little more than what is required. Etc. etc. You get the idea !
Adding value to yourself will also make it easier to get a good recommendation some day if needed for another job or career position. This is basically your best insurance from a life of poverty.
Be Prepared for the Worst
Even doing all of the above does not guarantee you will not someday be the victim of a layoff. Many things can happen that are totally out of your control. A company could go bankrupt. Governments could change policies that eliminate your job. Etc. etc. You therefore need a financial buffer to help through a potential layoff.
Many call it an emergency fund. Today, I call it a survival fund. I recommend saving an amount equal to three to six months of your committed expenses. Keep this amount somewhere where you can't easily get at it such as a savings account with no bank card access.
By following the above suggestions you should be able to prepare yourself as much as reasonably possible for a possible disruption to your main income stream. Nobody knows for sure what the future will bring, but we can take steps today to help limit the damage should trouble arise.
As always I welcome your comments and suggestions for future topics.
Tuesday, October 2, 2012
How to Get Rich - Have a Destination
Have you ever driven anywhere without knowing where you planned to go ?
Have you ever set out to do a job without knowing the desired outcome ?
Chances are you answered NO to both the above ! At least I hope so !
Plan Your Work
Before starting on a project you should always make a plan of the steps you need to take to accomplish your desired task. You also need to have a method for measuring your results versus what you planned.
Designing a financial improvement project is no different. In fact it should be easier than most other projects because everything can be measured in numbers. Let me use an example to explain this point. Let's say your project is to get out of debt by a certain length of time. You already know the amount of your debt and the length of time to accomplish your project. You simply divide the debt by the time to know how much you must save out of each paycheck etc.
More complicated projects will require steps. These steps should be planned out in detail and the results should be measured against your desired outcome. For example, let's say you wanted to increase your investment income by a certain amount per month. You must first determine how much you need to save to invest. You must then determine how many investments you wish to make to provide this desired income.
You must then look for good quality investments to provide this desired income. ( I recommend using my 50/12 Rule for this example - check it out in one of my previous posts)
Work Your Plan
Once you have developed your plan with all the necessary steps, it is merely a matter of starting to implement your plan. You have already determined what it is you need to do for each step. Start with your first step and just do it.
Of course you may find there to be obstacles in the way which you must find a way to overcome. This is normally the case with all well intended plans. These are the challenges that I mentioned in a previous post that must be overcome in order to reach your desired outcome (or goal) and to take advantage of the opportunities that await you.
Measure, Measure, Measure
Every step should be measured continuously along the way. Much like your car's odometer measures your distance traveled so that you know exactly where you are at any given time. This way you know how far you have come and how far you have left to go. This is a very important component of your project as it will help keep you motivated towards reaching your desired destination (or goal)
To know exactly where you are will give you a great feeling of well being as you look back to see how far you have come. As your destination grows closer, your feeling of well being will increase and your determination to reach your destination will become overwhelming.
In order to become wealthy, you must first know what wealthy means for you. (Your Destination)
Without knowing your destination and having a plan to get there, you could wander aimlessly in the vast world of financial challenges and opportunities and get nowhere.
As always, I welcome your comments and suggestions for future topics.
Have you ever set out to do a job without knowing the desired outcome ?
Chances are you answered NO to both the above ! At least I hope so !
Plan Your Work
Before starting on a project you should always make a plan of the steps you need to take to accomplish your desired task. You also need to have a method for measuring your results versus what you planned.
Designing a financial improvement project is no different. In fact it should be easier than most other projects because everything can be measured in numbers. Let me use an example to explain this point. Let's say your project is to get out of debt by a certain length of time. You already know the amount of your debt and the length of time to accomplish your project. You simply divide the debt by the time to know how much you must save out of each paycheck etc.
More complicated projects will require steps. These steps should be planned out in detail and the results should be measured against your desired outcome. For example, let's say you wanted to increase your investment income by a certain amount per month. You must first determine how much you need to save to invest. You must then determine how many investments you wish to make to provide this desired income.
You must then look for good quality investments to provide this desired income. ( I recommend using my 50/12 Rule for this example - check it out in one of my previous posts)
Work Your Plan
Once you have developed your plan with all the necessary steps, it is merely a matter of starting to implement your plan. You have already determined what it is you need to do for each step. Start with your first step and just do it.
Of course you may find there to be obstacles in the way which you must find a way to overcome. This is normally the case with all well intended plans. These are the challenges that I mentioned in a previous post that must be overcome in order to reach your desired outcome (or goal) and to take advantage of the opportunities that await you.
Measure, Measure, Measure
Every step should be measured continuously along the way. Much like your car's odometer measures your distance traveled so that you know exactly where you are at any given time. This way you know how far you have come and how far you have left to go. This is a very important component of your project as it will help keep you motivated towards reaching your desired destination (or goal)
To know exactly where you are will give you a great feeling of well being as you look back to see how far you have come. As your destination grows closer, your feeling of well being will increase and your determination to reach your destination will become overwhelming.
In order to become wealthy, you must first know what wealthy means for you. (Your Destination)
Without knowing your destination and having a plan to get there, you could wander aimlessly in the vast world of financial challenges and opportunities and get nowhere.
As always, I welcome your comments and suggestions for future topics.
Tuesday, September 25, 2012
How to Get Rich - Know Your Housing Market
Do you think you can get rich by paying too much for your home ?
Do you think the wealthy ever get caught on the wrong side of a real estate deal ?
The answer to the above is a resounding NO !
Your Home as an Investment
A common phrase often heard is that your home is the biggest investment you will ever make. I am not sure how this old saying ever got started, but my money is on the banking or mortgage industry. They are generally the ones with the most to gain from you having too big a housing debt.
First of all, the real estate that you live in is not really an investment. If you can't draw an income from it, then it is really just a place to live. I find it amazing how most individuals have been convinced to think otherwise. Why is it that everyone seems to be obsessed with buying a home well beyond what they can afford or even need? The answer is marketing ! From the banks, the home improvement companies, and yes the numerous reality tv shows. What a scam !
A Place to Live
Yes, a place to live. That is all your home really is. Now that you hopefully understand that, how do you know when purchasing your home is the best option ? Simple. When you can afford it. Decide what percentage of your income you feel is wise to spend on housing and don't go over that amount.
If your local housing market forces you to pay more than you are comfortable with, simply don't buy. It may be wiser to rent your home ( if it's more cost effective ) and invest the difference in income producing investments. This will help you in two ways. Firstly, it will increase your level of income. Secondly, it will give you time to really think about how you will be able to someday afford your dream home.
Home ownership is not always a good thing. Just look at the thousands of foreclosures in the US over the past few years. Many of those individuals will never recover financially from the housing market disaster.
Market Bubbles and Collapses
Most things go in cycles and real estate is no exception. Real Estate has a much longer cycle than most commodities, which is why many people lose money in real estate. They don't have the patience or the resources to wait out the cycle. Many simply don't believe that prices will ever fall.
I live in a current real estate market where buyers actually bid on properties, often paying thousands more than the asking price and often far more than the real value of the properties. Insane. Needless to say I have not been a real estate buyer locally for some time. I have however, been a seller on a few occasions taking advantage of the insanity of the buyers. Very profitable for the seller.
Buy low, sell high is my motto even when it comes to Real Estate that you live in. If you pay too much for your home, it could eventually become the noose that may hang you financially. Don't buy it if you can't afford it. Invest your money instead in something that will pay you an income.
As always, I welcome your comments and suggestions for future topics.
Do you think the wealthy ever get caught on the wrong side of a real estate deal ?
The answer to the above is a resounding NO !
Your Home as an Investment
A common phrase often heard is that your home is the biggest investment you will ever make. I am not sure how this old saying ever got started, but my money is on the banking or mortgage industry. They are generally the ones with the most to gain from you having too big a housing debt.
First of all, the real estate that you live in is not really an investment. If you can't draw an income from it, then it is really just a place to live. I find it amazing how most individuals have been convinced to think otherwise. Why is it that everyone seems to be obsessed with buying a home well beyond what they can afford or even need? The answer is marketing ! From the banks, the home improvement companies, and yes the numerous reality tv shows. What a scam !
A Place to Live
Yes, a place to live. That is all your home really is. Now that you hopefully understand that, how do you know when purchasing your home is the best option ? Simple. When you can afford it. Decide what percentage of your income you feel is wise to spend on housing and don't go over that amount.
If your local housing market forces you to pay more than you are comfortable with, simply don't buy. It may be wiser to rent your home ( if it's more cost effective ) and invest the difference in income producing investments. This will help you in two ways. Firstly, it will increase your level of income. Secondly, it will give you time to really think about how you will be able to someday afford your dream home.
Home ownership is not always a good thing. Just look at the thousands of foreclosures in the US over the past few years. Many of those individuals will never recover financially from the housing market disaster.
Market Bubbles and Collapses
Most things go in cycles and real estate is no exception. Real Estate has a much longer cycle than most commodities, which is why many people lose money in real estate. They don't have the patience or the resources to wait out the cycle. Many simply don't believe that prices will ever fall.
I live in a current real estate market where buyers actually bid on properties, often paying thousands more than the asking price and often far more than the real value of the properties. Insane. Needless to say I have not been a real estate buyer locally for some time. I have however, been a seller on a few occasions taking advantage of the insanity of the buyers. Very profitable for the seller.
Buy low, sell high is my motto even when it comes to Real Estate that you live in. If you pay too much for your home, it could eventually become the noose that may hang you financially. Don't buy it if you can't afford it. Invest your money instead in something that will pay you an income.
As always, I welcome your comments and suggestions for future topics.
Tuesday, September 18, 2012
How to Get Rich - Turn Challenges into Opportunities
Do you think the wealthy go through life without ever facing challenges ?
Do you think they never have to solve problems to get what they want ?
Of course not, everyone has challenges ! It's what we do or don't do to overcome those challenges that make the difference !
Your Biggest Challenge
The first step to overcoming your challenges is to identify your biggest challenge. What is the one big monster in your life or the biggest elephant on your back so to speak ?
For some it may be digging themselves out of debt. For others it may be earning more income to meet current expenses.
Whatever it is, you must learn what you need to do and then just find a way to do it. Remember, if you do nothing to overcome your challenges, you will go nowhere financially.
Determination
The one big thing that separates successful individuals from the average individual is determination. You will notice that a successful person has lots of energy and will not let anything stand in their way to getting what they want.
They know exactly what they want and thy never give up until they find a way to overcome whatever obstacles are in their path.
Overcoming Your Obstacles
The first step towards overcoming your obstacle is to believe you can do it. The next step is to gain the knowledge you need to tackle it head on. Lastly, take action with your new found knowledge and don't give up until you succeed.
Sounds simple, but it is far from it. Most people will become discouraged or be led astray by others. Many will become distracted by things that seem far more interesting or important at the time.
Your future will be determined by what decisions you make today. It's your choice.
Choose to become financially successful. Choose to start working to overcome your obstacles today.
Your biggest obstacle could be your own state of mind. Believe you can and you can. It may be that simple.
As always, I welcome your comments and suggestions for future topics.
Do you think they never have to solve problems to get what they want ?
Of course not, everyone has challenges ! It's what we do or don't do to overcome those challenges that make the difference !
Your Biggest Challenge
The first step to overcoming your challenges is to identify your biggest challenge. What is the one big monster in your life or the biggest elephant on your back so to speak ?
For some it may be digging themselves out of debt. For others it may be earning more income to meet current expenses.
Whatever it is, you must learn what you need to do and then just find a way to do it. Remember, if you do nothing to overcome your challenges, you will go nowhere financially.
Determination
The one big thing that separates successful individuals from the average individual is determination. You will notice that a successful person has lots of energy and will not let anything stand in their way to getting what they want.
They know exactly what they want and thy never give up until they find a way to overcome whatever obstacles are in their path.
Overcoming Your Obstacles
The first step towards overcoming your obstacle is to believe you can do it. The next step is to gain the knowledge you need to tackle it head on. Lastly, take action with your new found knowledge and don't give up until you succeed.
Sounds simple, but it is far from it. Most people will become discouraged or be led astray by others. Many will become distracted by things that seem far more interesting or important at the time.
Your future will be determined by what decisions you make today. It's your choice.
Choose to become financially successful. Choose to start working to overcome your obstacles today.
Your biggest obstacle could be your own state of mind. Believe you can and you can. It may be that simple.
As always, I welcome your comments and suggestions for future topics.
Tuesday, September 11, 2012
How to Get Rich - Understand the Number 72
Do you know what is significant about the number 72 ?
Do you know why it is so important to building wealth ?
If you read my last posting you do !
72 is a Magic Number
Further to my last posting, I would like to explain further why the number 72 is such an important tool for you to use in building your wealth.
As previously explained, the rule of 72 states that if you divide the number 72 by your investment's current rate of return and assuming you reinvest all of your compounding income once a year at the same rate of return, the resulting answer will be the number of years it takes to double your money.
Ok, pretty straight forward. But why is it so important to building your future wealth ? Let me explain by example.
Suppose you invest $10,000.00 at a yield of 10% rate of return paid annually.
If you reinvest your annual income every year your investment would be worth $20,000.00 in 7.2 years.
Now suppose your investment only yields a 5% rate of return paid annually. If you reinvest your annual income every year it would take 14.4 years before your investment would be worth $20,000.00 (72 divided by 5)
Why So Important
The above example shows just how important it is to find investments with the highest possible yield. Of course most investments fluctuate in value and can even decrease in value over time. Therefore, the rule of 72 should only be used as a guideline for forecasting future valuation levels.It is basically a tool used for estimating future values and in real life will never be exact.
It also does illustrate how valuable it is to invest your money versus leaving it in a bank savings account. The best bank accounts currently pay a yield of only 2% at best. Leaving your money there would take you 36 years to double your money. (72 divided by 2) Not a wise choice.
72 and You
Get comfortable using the rule of 72 and you will be able to see if a potential investment is suitable or basically good enough for your investment portfolio. Remember though, if an investment does not pay out regular income, the rule of 72 will not help in your forecasting. This is because you have no basis for your future growth other than guessing that your investment will rise in value each year. In reality, all investments, good and bad, rise and fall in value over time and are subject to many variables and risk factors.
The rule of 72 is merely one of the many tools at your disposal to aid in your building of future wealth. Use it for estimating your future values and comparing the effects of different investment choices. It will serve you well.
As always, I welcome your comments and suggestions for future topics.
Do you know why it is so important to building wealth ?
If you read my last posting you do !
72 is a Magic Number
Further to my last posting, I would like to explain further why the number 72 is such an important tool for you to use in building your wealth.
As previously explained, the rule of 72 states that if you divide the number 72 by your investment's current rate of return and assuming you reinvest all of your compounding income once a year at the same rate of return, the resulting answer will be the number of years it takes to double your money.
Ok, pretty straight forward. But why is it so important to building your future wealth ? Let me explain by example.
Suppose you invest $10,000.00 at a yield of 10% rate of return paid annually.
If you reinvest your annual income every year your investment would be worth $20,000.00 in 7.2 years.
Now suppose your investment only yields a 5% rate of return paid annually. If you reinvest your annual income every year it would take 14.4 years before your investment would be worth $20,000.00 (72 divided by 5)
Why So Important
The above example shows just how important it is to find investments with the highest possible yield. Of course most investments fluctuate in value and can even decrease in value over time. Therefore, the rule of 72 should only be used as a guideline for forecasting future valuation levels.It is basically a tool used for estimating future values and in real life will never be exact.
It also does illustrate how valuable it is to invest your money versus leaving it in a bank savings account. The best bank accounts currently pay a yield of only 2% at best. Leaving your money there would take you 36 years to double your money. (72 divided by 2) Not a wise choice.
72 and You
Get comfortable using the rule of 72 and you will be able to see if a potential investment is suitable or basically good enough for your investment portfolio. Remember though, if an investment does not pay out regular income, the rule of 72 will not help in your forecasting. This is because you have no basis for your future growth other than guessing that your investment will rise in value each year. In reality, all investments, good and bad, rise and fall in value over time and are subject to many variables and risk factors.
The rule of 72 is merely one of the many tools at your disposal to aid in your building of future wealth. Use it for estimating your future values and comparing the effects of different investment choices. It will serve you well.
As always, I welcome your comments and suggestions for future topics.
Tuesday, September 4, 2012
How to Get Rich - Learn 3 Magic of Money Secrets
Do you ever wonder why getting rich seems easy for others ?
Do you wonder what secrets they must possess ?
Truth is, they understand the Magic of Money and how to make it work for them !
Work for Your Money
Most people understand that you must get a job and trade your time for money. This is how you pay your bills and maybe someday save for your future.
However, most people do not understand how to turn the tables and get money to work for them. The rich understand this principle very well. They have mastered the art of the Magic of Money !
Turn the Tables
In order to turn the tables as the wealthy do, there is one simple lesson to learn. You must have some money in order to have your money work for you. Pretty simple.
However, most of us start out with no money. Then how do you get money ? Some inherit money, some win money and some even steal money. But those cases are rare and are not the ways you should be concentrating on to get your money. For most, you must learn how to save a portion of all you earn, then invest it. Simple. Try saving ten percent of what you earn today !
Magic of Money
1) The saving of ten percent of your income is something I have mentioned many times, but it is one of the most valuable aspects of the Magic of Money. It is the very first step for most of us in creating future wealth.
Without some money, how will you ever be able to have your money work for you ?
2) The Rule of Seventy Two is a very magical way to calculate your future wealth. Simply take the number seventy two and divide it by the rate of return on your investment. The answer will give you the number of years it will take to double your initial investment providing the income is reinvested. Simple, but very effective in projecting your future wealth and income from your investments.
3) The Fifty Twelve rule is basically investing in a way to create an income stream of fifty dollars per month. I have mentioned the details of this method in a previous posting, so I will not repeat it here. To build your income, you simply divide your desired monthly income level by fifty and create that many modules. Simple, but very powerful.
The above three secrets of the Magic of Money are all you really need to start on your way to building your desired level of income and your desired level of wealth that you desire.They can form the very core of your wealth building strategies.
Of course, there is much more you can learn in the world of finance and I encourage you to learn as much as you possibly can. However, these three basic principles (or secrets) can go a long way to ensuring you have a bright and prosperous financial future.
To turn the tables and have your money work for you, you simply must have money. Learn how to save, learn how to invest, then watch your wealth grow.
As always, I welcome your comments and suggestions for future topics.
Do you wonder what secrets they must possess ?
Truth is, they understand the Magic of Money and how to make it work for them !
Work for Your Money
Most people understand that you must get a job and trade your time for money. This is how you pay your bills and maybe someday save for your future.
However, most people do not understand how to turn the tables and get money to work for them. The rich understand this principle very well. They have mastered the art of the Magic of Money !
Turn the Tables
In order to turn the tables as the wealthy do, there is one simple lesson to learn. You must have some money in order to have your money work for you. Pretty simple.
However, most of us start out with no money. Then how do you get money ? Some inherit money, some win money and some even steal money. But those cases are rare and are not the ways you should be concentrating on to get your money. For most, you must learn how to save a portion of all you earn, then invest it. Simple. Try saving ten percent of what you earn today !
Magic of Money
1) The saving of ten percent of your income is something I have mentioned many times, but it is one of the most valuable aspects of the Magic of Money. It is the very first step for most of us in creating future wealth.
Without some money, how will you ever be able to have your money work for you ?
2) The Rule of Seventy Two is a very magical way to calculate your future wealth. Simply take the number seventy two and divide it by the rate of return on your investment. The answer will give you the number of years it will take to double your initial investment providing the income is reinvested. Simple, but very effective in projecting your future wealth and income from your investments.
3) The Fifty Twelve rule is basically investing in a way to create an income stream of fifty dollars per month. I have mentioned the details of this method in a previous posting, so I will not repeat it here. To build your income, you simply divide your desired monthly income level by fifty and create that many modules. Simple, but very powerful.
The above three secrets of the Magic of Money are all you really need to start on your way to building your desired level of income and your desired level of wealth that you desire.They can form the very core of your wealth building strategies.
Of course, there is much more you can learn in the world of finance and I encourage you to learn as much as you possibly can. However, these three basic principles (or secrets) can go a long way to ensuring you have a bright and prosperous financial future.
To turn the tables and have your money work for you, you simply must have money. Learn how to save, learn how to invest, then watch your wealth grow.
As always, I welcome your comments and suggestions for future topics.
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