AVOID 7 MISTAKES TO ENRICH
God helps those who help themselvesEvery household has got its own unique fundamentals as far as its financial quotient is concerned. Based on basic foundation, all the family members have to make out their strategy and planning to survive in this world with the optimum level of self-reliance in the money matter. Whatever your position may be or the status you can make it big if you avoid the following mistakes in a not so haphazard manner.
1. 1 DO NOT SKIP TO FOLLOW UP A FAMILY BUDGET.
Due to the hustle and bustle of the modern life we omit to chalk out a budget according to our resources and dreams.
A home budget would include the daily expenditures and income , assets and liabilities , our goals in the form of targets. There are many an App for making a budget and we can use it taking into account the following three Rs
Record:. You have to enter all the financial transactions both current and future
Review : Now and then we have to review the position so as to take stack of the situation so that we can make note of the progress and failure on our part and make necessary correction.
Revise: your budget to suit to your aims and take into account your limitations.Discuss your short term and long term goals. Split them into manageable and achievable small jobs .
This budgeet planning and execution should be performed as a fun game and we should not do it as a stressful one.
2. 2DON’T FORGET SAVINGS.
We have to save for the unforeseen circumstances and unexpected situations
The standard formula for the same is as follows
INCOME – SAVINGS = EXPENDITURE
Where there is a will there is a way. Put every month a small amount towards savings and over a period of time it would grow up to help at trying times. Work out the monthly income and expenditure to find out the amount you can save in month. Taking the same as the base amount we can fix a target of 10% addition to the same . Like this you have to increase the addition so that you could save a sumptuous amount over a period of time.
You can put money in a box containing various small containers and keep the cash according to your regular heads of expenditure. For example you can put a sum of Rs 10000 for grocery in a container and note down the total expenditure for this category . Like this you can use separate boxes for other categories also. Whatever remains should be tallied with your accounts . This helps us to study the pattern of how and where we the money goes.
3. 3 DON’T IGNORE INFLATION
Inflation eats away the value of our asset as such we have to plan our investment in such a way to take care of it.Any erosion in the value would result in loss and taking to a lower level
The follwing three aspects we have to consider when we go for an investment.
1 What about the reruen after taking into account inflation, income tax and other chargees?
2 Whether sufficient care is taken to cover the risk element?
3 Whehter we go by the herd mentality and invest or have we done our homework and do it on our own ?
4 DON’T PUT AL THE EGGS IN THE SAME BASKET.
The very old wise advice to spread out our investments to various category just because our needs would vary according to the time and change in our position. Various types of investment are available in the market to suit your purse and the risk factor . Investing in a single category would be very risky as this would lead to jeopardy of loss in the event there is a fall in the value drastically. Suppose you buy a plot making a huge investment if there is no appreciation of value you would have to settle with lesser profit on this .Hence you have to be more vigilant in making investment.
Diversify your investment and derive the maximum benefit. Buy low and sell high should be our mantra in creating our wealth .
5 DON’T PLAY WITH HALF KNOWLDEGE.
Before making a financial transaction, buying, selling or investing we have to study and make research so that our decision would not take us to a great loss. .At least we should not be carried away by the ads . Things would be exaggerated and we may feel frustrated afterwards .Without thorough knowledge we may make mistakes in our judgment.
6. DON’T FALL PREY TO DEBT TRAP.
Once a debtor always debtor .So goes the red signal as far as debt is concerned. Try to live within your means. If at all you want to get a loan you follow the golden rules.
1. For a purpose only the loan should be availed.
2. From a recognized institution you should avail the loan.
3. Work out the possibility of payment of EMI .
When you use a credit card take into account the following precautionary measures .
1. Go for those articles or consumer items like gadgets if at all you want to have them in the real sense .
2. Pay the bill as and when it is due date avoiding penalty.
3. Don’t go beyond your capacity.
7. DON’T OVERLOOK FINACIAL PRODUCTES LIKE INSURANCE AND MUTUAL FUND
We have to understand that there are many a product which gives us support at the time of our distress. Suppose one of our family falls ill and suffers from chronic disease we can not afford to spend the medical expenditure. So we have to take insurance policies to come to our rescue .Similarly we have to understand the financial products and utilize them for our benefit .
Time and tide wait for no one.
Mutual funds investment is a safe one provided you study pros and cons of the fund you have chosen .The brochure on them itself gives a warning about the risk involved in them. This type of investment gives us an opportunity to earn the passive income and hence it has to be encouraged.
MAKE THE BSET USE OF INTERNET AND TECHNOLOGY.
There are so many Apps to handle this money matter. In the smart phone itself you can download from Google play store . If you punch the data you could get all the tips and tricks to monitor your financial journey. We can get from the internet all the golden guidelines and the fantastic suggestions for improving our economical status in the society and be financial literate.
Only an open and eager mind and echt willingness to learn are necessary to achieve our dreams and stabilize our financial freedom.
There is no shortcut for wealth creation. Only hardwork,discipline,integrity ,sustained efforts and prudenence alone pave way for long term richness.
FOCUS WITH 100% ATTENTION
MAKES YOUR DREAMS A REALITY