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Posts Tagged ‘Money Management’

Have you heard the argument of 90/10? This means that 90% of the total wealth controlled by 10% of the people. Why can so many property controlled by a number of the rich, while on the other hand most other people have taken the trouble to fight 10% of the remaining assets?

This is because the rich have a secret recipe that is not taught in ordinary people. This recipe is only revealed in their own families or close relatives, through word of mouth. By using this recipe, they can live a relaxed without worrying about a lack of money. They do not need to work to earn money, but, money who come looking for them.

Unfortunately for ordinary people, to get this secret it takes years of experience and research that deep. After all the secrets that they are following the road is full of tricks and traps, so that without adequate knowledge, will be many who had incurred costs in vain to try it.

In all dimensions of life there is always a set of rules, tricks, and more. that help us deal with the task ahead. In finance we have a lot of these but I think there are some that are amazingly simple to be tools for your planning. Here are some of these rules:

Investments: The Rule of 72
This rule is very interesting, will tell you approximately how long you take to double your investment. For example, if you invested $ 1,000 8% annual interest, will take 9 years (8 / 72) to make your money grow. If you stopped these win the $ 1,000 fee for 27 years, you’d have $ 8,000 in the bank.

Therefore it is said that the best friend of money is the time that this investment, and therefore invest drinking the earliest you can for your retirement.

Savings: The rule of 10
You should always save at least 10% of your income. This rule is not only essential for you to save, but because it attacks many basic principles of a healthy financial life. If you save constantly are learning to live on a budget, you are saving for an emergency, you are saving to invest and are creating financial security that will help you progress. This is so important that even the Bible speaks of tithing.

Risks: Do not invest what you are not willing to lose.
Investments that you are at risk of losing value. Unlike a deposit account (savings, certificate of deposit), they can lose value, especially when the market is so volatile at this time. In the long run (at least historically) investments increase, but if you have money invested that you need quickly, you may not give the time necessary to recover the losses.

Do not invest money that is intended for your needs, your emergency fund or your monthly expenses that might get lost and fall into a financial crisis. Only you can invest the capital to let it grow long or if they do not lose your financial imbalance.

Mortgage: The Rule of 33
You should not have a mortgage / rent is more than a third of your monthly income. This will help you identify what you can pay monthly when you are buying a home, or when you’re considering relocating to another apartment. We tend to forget other necessary expenses (food, transportation, utilities) and sometimes we commit to pay a lot more than you really should.

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If you are expecting a new addition to your family these are things that most parents have to take into consideration:

Health Insurance
Make sure you know how she is that your health insurance covers the delivery and whether charge you more if natural birth or cease. Also note that if the baby out with complications (God forbid) you should have the necessary coverage to ensure their welfare. If such cases do not have insurance, research with community organizations if there is any help in your area.

Pay most of your debts
Try to pay as many debts as possible before the baby is born. Raising a child is very expensive, and only gets harder so you can pay your obligations. Also remember that you’ll have to start saving for the education of the baby and their future costs.

Life and disability insurance
One of the most important things in which you think is a little person who depends on you to live and sustain themselves. If someday could provide missing or you have to make sure that guy will be in the best positions. Visit my article on life insurance for more information or an insurance agent near your home.

Prepare to have less income
One of the hardest things that happens when a couple have a baby is that for a while household income will be reduced drastically. It is important to be able to budget to take account of this, or at least able to save enough money during the pregnancy to be sure that the time you or your partner stop working not reach a financial crisis. This is one more reason why an emergency fund is so important.

Much of our revenues are going into financial service charges. Interest, money orders (money orders), surcharges, overdrafts, etc. are some of these for example. Here’s a guide to be able to save here and there in your services and you have more money in your pocket or in your piggy:

Contact your credit card to reduce the interest.
Every six months the credit card companies can assess your credit and payment history to tell if there is any way to reduce your interest / increase your credit line. If you have not done so, call each of your credit cards to Represent and ask if they can reduce your interests. This works best if you owe much to the cards, you have a spotless payment history, and if you invent a pious little lie that another company is offering you a lower rate for you to change.

Withdraw money from an automated teller machine (ATM) from another bank.
Most banks penalize you if you withdraw money from another ATM that is not yours. If you do two or three times a week this can make about $ 60 a month or more. If your bank is too far or inconvenient, do not need to be faithful to your bank, open a bank account that will be closer to your work / home (where you need money) to avoid as much as you can use these services.

Do not be so loyal to your bank.
A bank is not a dating or marriage. It is a business relationship in which an institution offers a service that you value and therefore charge a monthly fee and you pay interest on the money you have in them. If your bank does not pay the best interest or does not offer the service you need (ATM, reasonable monthly fee or free, internet banking, free bill payments, etc.) Do not have to go with them, no matter how years have in this relationship. Try each year to assess what services your bank offers others offering in the industry and choose the one fill your expectations. For your savings account, consider an online bank that offers a higher interest rate.

Do not use money orders, use your bank.
Many people use money orders (money orders) to pay your bills (Biles) every month. This can be around $ 20 a month or more you can save by using services with your bank to do so. Online banking usually has an automatic payment system that can be done from your computer. This service is usually free and help you pay your bills on time, without delay or cost you a penny. Online banking offers at the same time a service to write checks / payments to others for free. You can also pay with your debit card that can be used to pay for phone or on the company’s Web site that offers the service (cable, telephone, electricity, etc.).. If none of that works you can also use your checkbook to make the payments and will cost less than a spin.

Check your report (report) credit each year.
Any errors in your credit report can cost you in higher interest rates. Check your report at least once a year to get an idea of how are your finances.

Eliminate your debts
If you have a debt with a credit card or loan, this is costing you money every month. Make a payment plan to help you out of these debts as quickly as possible, eliminating those that will always charge a higher interest rate first. PowerPay I recommend that you use to make your payment plan and you use your budget to identify how much money they can spend on your debts.

Very useful tips that should keep in mind when you go grocery shopping:

Before going to the Supermarket
* Plan your menu and write your shopping list in advance. This will help you buy only what you need, and prevent food from spoiling.
Eat something before you go shopping. If you shop hungry, will be tempted to buy things they do not need.

In the Supermarket
* Buy fruits and vegetables in season. The markets for farm products (Farmers Market) is a great place to find good prices.
* Buy canned or frozen fruit supply. Make sure they are packed in water or 100% juice without added sugar.
* Buy canned or frozen vegetables offer. Canned vegetables before cooking, rinse with water to reduce salt content.
* Try store brands are as good as commercial, and significantly cheaper.
* Look for coupons and announcements of deals in the supermarket and get the discount card to customers.
* Spend your food budget wisely. For the same price of a big bag of chips and a box of sweet biscuits, you can buy a lot of apples, bananas, carrots, potatoes, peppers and other healthier foods.
* Join a local food cooperative and share the cost and shopping with a friend.
* Join a community garden and learn to grow their own vegetables.

Upon arriving home
* When your budget and time permit, cook “wholesale.” Cook a large amount of soup, chili or spaghetti sauce, divide it into family-sized portions, label and freeze to eat later that month.
* Take the leftovers to reduce preparation time and save money. For example, to prepare a grilled dish, serve half and freeze the rest. Then use it with vegetables to make a quick soup, tortillas, a dish fried or hash.