A Finance And Investment Club Presentation:
Do you constantly worry about how to manage finances and how to manage your money? Does it keep you up at night? Don't worry... you are not alone!
As much as we want more money, we also need to learn how to manage it! And if you are like me, then you also don't realize that to do so, we first need to understand ourselves! Want to know why and how? Then follow these key steps and carry them out, and you will be well on your way to successfully managing your finances & money:
1. Understand your spending: Look at your current spending and gain an insight into your spending activities. You can dig into the nature of your spending, such as which categories are you spending your money each month like food, restaurants, shopping, etc. You can also compare one month's spend with the previous month and more. This will help you understand whether you are a pragmatic consumer or an impulsive buyer!
2. What kind of a buyer are you? If you are an impulsive buyer, then you need to carefully look at your debt profile and make sure that you first pay down your debt before you buy non-essentials again. We all know why, because of money wasted in paying the interest on your credit cards or loans is not worth getting your emotional happiness from splurging in unnecessary shopping.
3. Develop a budget! Once you understand your expenses, then develop a monthly budget and come up with a slight excess (income less essential expenses such as utilities, food & supplies). If you fall short, don't worry for now, skip 4. below and still develop your budget.
4. Shortage or excess? If you have any excess, consider saving it or splurging it based on your needs, AFTER you save some for your retirement or upcoming travel expenses (unless you budget for such expenses anyway). Regarding retirement, it is essential that you contribute to your 401K up to an amount, that your employer also contributes to.
A good tool to use freely to help you with easily gather and analyze all your spending in one place is Mint.com online or a desktop tool Quicken Personal.
5. Analyze your income! A mistake most people do is not to look at your paycheck each pay cycle you get from your employer automatically deposited into your bank a/c. You should know what is getting deducted from your paycheck each month, so if you see any unexpected cuts like that, talk to your HR.
6. Shortage? If you are falling short of your essential expenses, then pick up a second job depending on your time availability and skills you have. A second job could be anything, from working part-time at McDonald's to freelancing online.
7. Do you worry about your investments? If you have investments, carefully analyze your positions and return on such investments. If your goal is to grow your money in the long-term, then unless entire market is going down, don't sell your holdings. If your goal is to profit from daily or weekly market moves, then of course make sure you read the market every single day.
8. Couple Key tips for investors that will give your some comfort -
a. If you are an investor, then keep this one simple thing in mind - when interest rates are low, invest in equities such as stocks, ETFs, etc. If interest rates are high, then invest ONLY in bonds.
b. Another key if you invest in precious metals is that you can invest in them as long as the yield on 1 year treasury bill is less than the inflation rate. If it starts creeping up and crosses the inflation rate, then you need to get out of your precious metal investments.
9. Get social! 'Like' pages such as Young Investor Club ( www.facebook.com/younginvestorclub ) and get their daily free investing tips in your facebook account.
10. Finally, join a good membership site such as Finance And Investment Club and get good tools & resources so that you can easily track the above steps and monitor your own effort in successfully managing your money!
Finance And Investment Club can be reached at www.financeandinvestmentclub.com