September 25, 2022
The secret commandments to make more money

The most frequent interaction we have with money is when we spend it. And we don’t often think about ways to manage it, and other concepts like saving, investing etc.

In today’s telecommunication age, we have near instant access to all sorts of information, especially financial information. The more fantastic or sophisticated it sounds, the more viewers and readers it attracts. The (unconscious) message is that we need to be clever and cool with our money if we are going to be financially successful. If you just came into money, then you need to find the most esoteric investment strategy possible, that “only a select few have access to.” We encounter this kind of thinking quite regularly.

Has any of this helped us make better decisions with our money or improved our finances? The evidence would tend to say that, on balance, it has not. Sophisticated got us into a financial crisis, and the average life is riddled with debt and unprepared for retirement.

Below are the basic things we can do with our money are:

  1.  Save it
  2. Spend it
  3. Give it away
  4. Pay taxes;
  5. And pay down debt.

Money personality

This refers to your money attitudes and money habits. Are you a saver or a spender? Do you worry about money or do you refuse to think about it? How do your emotions control the way you manage your money? A person’s life experiences affect the way they handle money, the attitudes they have towards it, the financial decisions they make, their money values, and their willingness to take risks in money matters.

Financial goal-setting

A goal is something specific you intend to achieve. Goals should be ambitious but also rooted in your reality. For example, if your goal is to be successful, you can create an action plan that will take you there. When we break it down, the steps to achieve it are: having business or working with company which would require your time to serve and during this experience, that might teach you the potentials you need to be successful, with some hard work and dedication, you will attain your goal.

Read: Knowing the potential that can turn an idea into a business startup

The same way, when it comes to your finances, set goals. Take an inventory of your resources and make a plan accordingly. If your goal is to save a certain amount by the time you resign from company work please do it, make sure you write down all the factors involved. Things like the amount to save per month, what you need to startup your business, figure out where the money will come, figure out how much you can set aside once you pen down all the factors involved. Then commit to doing it.

Building good credit

Just incase you are  student, having good credit will help you make larger purchases such as buying a car or a house. It’s good practice to work on it earlier—and the most convenient way to start is with a credit card. Just be sure you know how to use it. This means:

a. Pay your bills on time. Payment history makes up a third of your credit score.

b. Aim to keep your debt low. Divide your debt on a credit card by the amount of credit available. Try to keep this ratio below 30%. This makes up another third of your credit score.

c. Start early, as 15% of your credit score is based on length of credit history. Parents with good credit can help their children build a credit history by adding their name on their credit cards.

d. Consider increasing your credit line every now and then. Credit reporting companies like to see how you handle new credit. This makes up 10% of your score. But beware: too many inquiries for credit, especially in a short period of time, can hurt your score.

e. Having credit cards and installment loans with good credit history will raise your score. This is the final 10% of building a good credit score.

The basics of investing and retirement planning

Do you dream of retiring early? Or at least, retiring with a padded bank account? I know I do. Learning how to invest and planning for retirement at a young age can help you do just that.

Learn the difference between saving and investing. Learn the power of compounding interest. Learn how to fill out a W4 withholding form. Learn the different investment options (i.e. stocks, bonds, mutual funds etc.) Know about retirement options such as pensions, 401(k)s, IRAs and how they work. If a college student is working, has an emergency savings, and is budgeting, they can start an IRA. Little bits of money today will mean a lot of money in the future (the power of compounding)!

If you learn this in college, you will be better prepared to take advantage of your first job when you graduate—and every job after that.

Becoming a savvy consumer

As consumers, you will be spending money. But it doesn’t mean you can’t get the best buck for every dollar spent or that you should be taken advantage of. Do your research when considering buying a product. Can you find a student discount? Did it come recommended by people you trust? Will it live up to your expectations? Are you able to return? These are all things to consider to make sure you get your money’s worth on everything you spend.

Have you ever wondered as to why people who start off together don’t end up together; at least when it comes to wealth creation? It is quite often that you find people with lower levels of income doing a much better job of managing the money. When you make money work hard for you, it is essentially about making it last for a long time. Let us look at 5 investing secrets of the wealthy and how to early money quickly you also need to plug your expenses.

Here are 5 secrets about making money fast by getting the basics of money right.

1. Downsize your house and locality

We all love to have that extra room with a view in a tony locality. But such things cost a bomb and more often than not they are just not worth it except for getting a kick out of putting money down the drain. As a general rule, the bigger your house, the more it costs to buy, operate, maintain, and insure.

2. Use the first opportunity to get out of debt and also stay out of debt

Debt has a huge cost in terms of interest, your peace of mind, your credit rating etc. When you are servicing your debt you are actually paying today for something you bought at some time in the past. Firstly, this debt payment sucks up more of your cash flow each month and secondly it is not adding any real value to you. By cutting down on your debt, you reduce the monthly demands on your money and you can use the surplus liquidity fruitfully.

3. You don’t have to retire at 65 if you are fit to work longer

Working after 65 year is not about money but also the need of keeping yourself fruitfully occupied and engaged in your area of specialization. People like Warren Buffett and George Soros are still working actively at the age of 85. Just because you’re ready to give up the rat race doesn’t necessarily mean that you’re ready to be done working altogether. Money always comes back to you in different ways and your skill is one of them. If you have it and there is a market for it, you can as well use it. In the process, you can also plan your finances better.

4. Cut costs, target bargains; in short get more bang for the buck

Why should take a cab when you can take the sub way with equal efficiency. Cut out the frills and you will be surprised by how much you can save over time. In the era of internet, look at salivating bargains. By just going to a website, there are big savings you can make on hotels, airlines, travel packages, groceries, garments, furniture etc. Make the best of it. You can either spend less or get more for less. If you have the leeway of travelling in off-peak periods, try and make the best of that. Off-peak prices are generally lower, which saves you money. Because you’re dealing with off-peak timing, it usually means that whatever you’re using is less crowded, too. That is not a bad combination at all.

5. Be disciplined and stick to it

A lot of these secrets may be really pointless unless you have the discipline to persist with the idea and implement it day-after-day and year after year. This is discipline is a lot like losing weight. It is not how well you start but how well you sustain that really matters. It is the same case with budgeting. A budget works only if you stick to it. This is the rule that beats all rule because if you don’t have this discipline, then no amount of smartness can help you to make your money last longer.

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