Saturday, March 23, 2013

Three money management tips for single

My brother has high salary but he can save so much money. He often spend the money for leisure things. He buy the gadget; whereas, he has had new gadget. He also like cars and he has three cars. He also charity to our family. He used to give his nephew and niece five to ten dollars. That is why his nephew and niece also love him. He is a generous man.
The company that he work also provide health benefit. He will get some money when he sick. The company also provides retirement fund. He has so much money because he has not yet married. He does not need to pay the school fee for the kid. He also does not need to buy food and cloth for family. However, he should manage the money for the future. Someday, he will marry a girl and must fulfill the family needs.
I also suggest him to buy a house or land but he seem no hear me.   I believe he can collect so many assets by investing in stock or other investment.
Here are the money management tips for single:

1. Create a budget
We can set a part for the various spending. The budget help the single to manage their money. They can thrift the spending. The single should save more for the future. They maybe easy to get the money now but someday they will be difficult to find money. They should save so much money to cover them.
List the expenses that you use to spend. It is not difficult to do it. Write the expenses in a spreadsheet or note book.  The first expenses are the most important expenses such as food, cloth, gasoline, transportation cost, apartment fee, and so on. Then watch the list. You can reduce the item that you do not need it very much.
Separate the need to the want. The money is never enough to buy your want. You have to drive your self to buy useless things.  Reduce eating out o save hundreds dollar a month.
Be clever to spend your money too. Buy used things that are cheaper than new one. As long we can select the item, we can get the good items. We can buy used book or hire it at library.
A single will married someday and they need to save money for it. The cost of wedding is high too. In my country, the man should provide bride price for the woman. The bride price is not cheap.
Do no forget to allocate some money for saving. A least you need to allocate you salary to your saving.  The rule of thumb is ten percent. I hear Chinese labor can save 70% of their salary and they also invest he money at capital market. They could reach wealth soon though hey are jus a labor.

2. Avoid to buy everything
A single woman often buy the cloth, accessories, cosmetics, and so much. They want to looks beautiful. They can spend thousand dollars a month for spa, salon, and others.  On the other hand, a single man tends to buy gadget or electronics. They can save thousand dollars to satisfy their curiosity on the gadget. A single man also likes car or motorcycle. He can buy so many cars for showing to his friend. They want to
They have to press the desire to buy anything. You just need gadget to communicate to other people. You may do not need the feature of the gadget. Use the gadget until it broke and you can buy the new one.
3. Set the emergency fund
Set aside liquid cash for emergency fund. When you need cash immediately, you can use it. Some people who does not set the emergency fund will find debt to cover the living cost. They must  payback the debt with interest. Emergency fund or rainy day will avoid you increase debt.
Emergency fund is like umbrella in rainy day. The umbrella will protect us from the rainy day.
The amount of the emergency fund depends on your routines spending. If you spend more money, you have to set more money for emergency fund. Thus, multiply your monthly spending with six or twelve times. That is he rule thumb of emergency fund.
Where do we put the fund? Some people may hold the cash at the house. I think it is not safe. You can also put the emergency fund in short term investment or liquid investment so you can withdraw the fund wherever you need. 
Read Also:
Financial Planning for 30's
Golden rule for financial prosperity

Wednesday, March 20, 2013

5 ways on how to lift from poverty

The world is full of various people. Some people are rich but some others are poor. They are hard to find dollars for buying foods. Sometimes they must find food at rubbish. They hope the rich man throw the food to rubbish. I believe the food must be bad for health. They are forced to live in shirt without a settle. The cold often make them fever and the rainy make them wet. They just burn the fire in a barrel to warm their body.
Most people do not want to live in poverty though lazy man. People try hard from morning to evening to lift them from poverty.  Some poor people choose wrong ways to lift from poverty.  They sell the kidney for thousand dollars. I believe I will not lift the poverty. They still live in poverty and loose the kidney. We do no have to sell our organ to lift the poverty or play Russian Rolette for it because there are so many ways to lift from poverty?
There are some ways to lift you from poverty, such as:
1. Working
Most people get money from working. They will get paycheck everymonth from the company. The company also give the employee retirement fund, medical benefit, insurance and others. After work dozen years, you can lift the poverty. You may have car, house, and other. You can also consider working for government. Find the jobs that right for you.
Only few people will get the top position, such as Jack Welch. Most people will stay in down line or work as clerk. They may not rich but they can lift them from poverty. They can save dollar by dollars for long time.
You can work as a freelancer. If you have a skill, you can offer to other people or place ads in gigs. The people will pay you after you finish the jobs. At first time, you can offer free service or cheap payment service but after that you can charge expensive fee for your service.
Walk around your environment. Perhaps your neighbor needs you to paint the wall or house. You can also help your neighbor to cut the grass or others else.
2. Starting a business
In a developed  country, most people prefer to start business rather than working as employee. They believe that business can make more money rather than working as employee. They do not have to go to office everyday but they receive more money.
This is a fast ways to live from poverty. If you have marketing skill, you can get money fast. You can sell anything to other people to makes money. The return of selling could reach hundred percent in a short time. It is better than any investment today. For example, you buy a toy one hundred dollars this day and you can sell it for two hundred dollars. 
You do not have to have much money to sell anything. You can sell other people stuff to get the margin. Surely, you need to ask the permission first. Some blogger or website owner sells other people stuff for the commission. The commission is not much four percent but you can make more money. In my country, a internet marketer got $5000 per month from Amazon.

3. Saving
You may not have much income but you always set aside the money for saving. After long time, you will find your money so abundant. You can become wealth someday. I hear a poor man collect a penny by penny and he bring the penny by wheel. He buys the house after he collect the coin dozen years.
Saving is very important for every one no mater what is your prophecy. The rule of thumb is ten percent of your income. Place the saving first when you receive the salary. You can put the money at the safe place.
Saving does not mean you insert the coin to the piggybank. You can also save the money when you buy at the grocery. You can also use coupon to save some dollar.  You can save so much money from there. You can save the money or you can use the money for other need.
Saving is also important when you must spend for unexpected things. We cannot predict when we sick. Sometimes we must go to the hospital because a virus attacks us.

4. Investment
After saving money, you can invest it to the investment. If you are lucky, you can get benefit from it. Some people can get benefit from gold investing. They have invested their money to gold years ago. They know that the gold price will increase due economic meltdown.
On the other hand, the stock market investment is not good recently. Most market index declines so it can generate return to the investor. However, someday, the stock will rise to the peak. We do not know when it will happen.
Do not put your money to an investment only. You can allocate the money to various investment such as stock, ETF, mutual fund, and else. Consider the real asset such as land, farm land, property and else. The property price increases and you can also make money from it. Rent he property o whoever need it. 
Manage your investment well. Construct the portfolio that can reduce the investment risk. For young people, they can prefer the risky portfolio that consist risky investment. Thee risky investment is risky but it can make more money. For old people they are better to safest investment.

5. Write a book
Some book writer can make million dollar from book. If you have talent to write, you should start now. Increase your skill to write by writing in blog. Someday they become a famous writer in the world.
Everyone is an expert like Seth Godin said. Why something do no write that you know it very well? The people may buy your book.

You should work hard to lift you from poverty. Do not hope that gold rain come to you.

Tuesday, March 19, 2013

Why a retiree should saving his money?

The retirement is an element of financial planning. The financial planning is said not completed if it does not include the retirement. Either employee or businessman needs retirement fund. Those funds are important when they retire from company. We realize that we cannot work forever. Old man cannot work fast as the young man. Some old man has disease. They cannot stand for hours or sit in the front of the computer for hours. That is why the company retire the old man and replace them with young man. The company want the efficient and effective employee or labour to gain profit.
After retire, the retiree has no paycheck from the boss.If the worker has a business, they can generate money from there. The business revenue can replace the paycheck. However, not all retiree has business, so they just expect the money from retirement fund.
If you save much money in retirement fund, You can withdrawn much money too and reversely.
When the worker near retire,  the spending could increases. Perhaps they need big fund for kid education. The college fund is high today especially medical school.
When you retire, you may need to maintenance your house because you have used it for dozen years. The leak roof should be improved or it will damage the other part house. For the retirement who has not yet pay the mortgage off, they need so much money.
For the freelancers or businessman, they should contribute to the retirement fund too. They are different from employee which the company cut the retirement fund from the salary directly. The freelancers or businessman should earmark the payment and business profit to the retirement fund.
To get the great retirement fund, people should contribute early. They can start to contribute at twenties. The money will grow over many times. They will withdraw more money than employee who starts contribute lately. Example, Mr Jones started contribute the retirement fund at 20. He used to paid $100 each month. Now, Mr Jones decide to withdrawn the retire after 50 years work. He will get  equals. On the other hand, Mr Thorn used to contribute $100 but he started to save at 40. He also withdrawn at the 70. Mr Thorn got equals
We can see Jones got more money than Mr Thorn despite those two employee contribute $100. Jones has started to contribute earlier than Thorn.