How to increase net worth

People try to increase the net worth that depict the wealth. Net worth is the difference between the assets and the liability. A rich man may not have high net worth if he or she borrow money to buy asset. Off course, the high debt makes the people or unwealth. Example, Mr. Jordy has luxorious car, and big house but he lease the car. Each month, he has to pay two hundreds dollar while his salary is only $ 2,500. Meanwhile, his neighbor Mr Jones has no car. He just got $ 1,000 from the business but he has no debt. He has paid the house previous years. Though Mr Jones salary is lower than Mr Jordy, Mr Jones has higher net worth.
The higher net worth, the more rich people. There are some ways to increase the networth:

1. Increase the asset
This strategy is good for people who cannot reduce the liability side. They should work hard to increase the asset side to balance the liability side on the right.
Increase the cash stream by working for other company, opening a business, selling stuff at internet, selling the stuff at the garage, and so.
You can also increase the house. Buy some house and hire those house to the renter. The renter can pay the rent expenses each month or each year.
Beside buying house, you can also buy other aseet to keep your value of money. Buy some productive asset to increase your networth. Some plantation or livestock can make you money. The plantation can produce fruit and cereal and you can sell it to the market.
2. Decrease the liability
This strategy is fit for someone who cannot increase the asset. They have to decrease or reduce the debt so it can lift the net worth. Try to decrease the useless liability such as plasma tv, luxorious car, and other.
Settle the debt as soon as possible. Use your asset to pay the debt with interest. The high debt decrease your net worth and it may reduce the asset. 
3. Increase the asset and reduce the liability
This strategy can increase your net worth fast. Surely, everybody can do it but the result may vary.  Despite you have much money, you do not spend it for luxorious things. They prefer to save or invest more money to make other money. As consequently, the asset may increase because the asset can generate money.
Our investment such as stock, mutual fund, or ETF price might increase. When we sell the investment, we will get money.

How to become financially stable

Diversify your income
A man should have more than one source income due tight economic. We cannot depend on salary only that your company have not increased it year to year. Some employee save a part of salary to build a business with the friend or colleague. They can work for the business after working from office. It does not disturb their jobs in the office.
If you are busy, you can invest your money to reliable friend. They may share the profit with you. While, you are still working, your friend will send money to you.
Is it enough to generate income from two source? No, you can expand other source. You can buy some asset such land, car, boat, and others.
Get money from various income types.
Most employee get monthly salary that is derived from the boss. The high salary base on our contributor to the company. The manager level employee can get higher salary than the staff. The company also employ the expert with high salary.
Due to economic tight, some company reduce the employee. The employee who depend on salary will got nothing. They just receive pension rate. If the company are kind, they may give severance that can we use to find other jobs.
Speaking about financially stable is not complete without talking about spending. To reach financially stability, the people should manage the spending well.
The debt usually may affect the instability. When the interest rate high, we need more money to pay the debt. Allocate the money to settle the debt soon. If you have excess money you can settle all of debt. Perhaps, you will get penalty but it will enlighten you next day.
The increase of good also may disturb the financially stable. They can make flexible budget to anticipate the increases goods. There tips to reduce the spending such as buying in bulk, using coupon, and others.

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Why Financial Planning is necessary?

Some rich people hire the financial adviser to construct the financial planning for them. They realize that financial planning is necessary for them. They can plan to make the company great or live comfort after retire.

Here is why the financial planning is necessary:

Management
The spending should be less than the income is the main principle of the financial planning. The financial planning can help us to manage our money. It helps us what kind money for spending or saving for any people.

Estimation
The financial planning can estimate your financial needs in future. You may have some plan for future such as buying house, paying kid college, traveling around the world and else.
If you want make your dream come true, you can estimate the money you need in future. If you just an ordinary clerk, you must be difficult to make your dream come true.
Portfolio
In financial planning, we put the money not only in stock only but also other investment such as ETF, mutual fund, precious metal, and else. You are in high risk when you put all money at stock only or bond only.
Some financial plan as to diversify the asset to various financial assets or real asset. When the economic tight, they can buy more real asset such as plantation, cattle, chicken and others.
Retirement
We need to set up the retirement when you have no long work. It can guarantee you to get cash stream when you have no salary. The financial planning suggest as to set apart of our salary for retirement. The amount of money that you save at the retirement fund will increase. It because the investment generate the revenue. If you have no retirement fund, you can invest directly to the some company. In future, they may fulfill your necessity someday. The financial planning explain the steps to go wealth with restricted salary that you have. It suggest you live in frugal though you can generate million dollars.
Big Expenses
What happen to us in future is unpredictable. That is why the financial planning is important to fulfill the big expenses. A employee may got sick after working hard, the child may need dozen thousand dollar for college fee, and so. Without good financial planning, the man could not fulfill the big expenses.
A good financial planning encourage man to prepare money fro big expenses. They should not worry about the big expenses.
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Golden Rule for Financial Prosperity

Every world citizen wants to financial prosperity. They try to work hard to achieve a financial prosperity. Here is the golden rule of financial prosperity:


1. Stream multiple incomes
The Salary or paycheck that you receive from your boss may be not enough for you. You can find other source to support your living cost. Some employee may find side jobs that they can do after arriving home. The blogging may be also a good ways to stream few dollars.
There is trend in my country; the younger employs prefer to stop working as the employer.
2. Shelter
People who are unable to own the house must be uncomfortable. They have to hire the house or apartment to other people. If the owner expels you from house, you can do anything. They have the house.
In my country, some rich man proud for their much house. They buy so many houses at different place. They rent the house to other people.
3. Vehicle
In Java culture, a man should have a ride. That is why the motorcycle is very salable in Indonesia where the most Java lives at there. They often use motorcycle leases. We just need $50 for down payment and we can pay the residual of the credit on three years. Using motorcycle is very economist. You just need a liter of gasoline a day. However, the motorcycle is high risk. Over 60% traffic is caused by motorcycle.
Having a motorcycle may be not enough for you. A good cheap car can bring you to office. You do not have to buy a luxury car though you have million dollars in your pocket.
4. Avoid debt or loan
A man should not ask the loan or borrow money from others especially consumer debt such as vehicle, TV, and others. If you want borrow to growth the business, you can consider it.
My business guru refuses the loan proposal of his student that require loan. He said that the student should sell the asset that the student had. He wanted to borrow the student if the student has no anything.
The student must be disappointed with my guru but he did what the guru said. He sold his asset such as motorcycle, cell phone, and others. After three years, his business has grown. He has a good car.
From this illustrative, my guru want to teach that we should avoid debt.
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Why people fail to reach financial freedom

They have good jobs and they have much saving. They also contribute to retirement fund. They have done what the financial experts suggest. However, the people cannot reach the wealth or financial freedom. How about people who have no jobs? They must be suffered.

Here are some reasons why they fail:

1. Cannot get the right jobs
We live when the high unemployment rate is so high. The opportunity to getting jobs is low. Some people prefer to open a business rather than waiting the office asks them for an interview.
For unemployed people, they are difficult to save or invest because they have nothing. Some of them depend on the parent gives or they become homeless. They hope from people bless in street.
2. Adaptable
I saw so many businesses can adapt no matter the regime who lead the country. They are adaptable to any business condition. Either communist or democracy government, the businessman can earn high profit.
As the individual, we should be adaptable with the economic situation. The high inflation does not affect this kind man. He or she may replace the investment or saving that can earn profit in the inflation. They will change the business core when the inflation is very high.
3. Marketable skill
While some doctor cannot generate money, a teenager can generate thousand dollars in a month. In my country, there are so many young writers who have published dozen books. The young writer usually writes teen fiction.
If we have a marketable skill, we will not starve. Though you have no jobs, you can sell your skill to the company or other people.
Find that skill that only few people masters it. The people will find the people with skill.
4. Has no planning
Most people have no planning where they go. They are difficult to reach financial freedom because they do not know what they should do. They may be a high paying employee.
Set your planning today. Let say, you want a master degree or real estate for next five years. You will be motivated to gain the money. Set some part salary for master degree and real estate. 
5. Destiny
I do not blame the God that has made people poor. The man could not change the destiny no matter how hard they try. However, you should work hard to reach financial freedom. There are so many opportunity in the world. Do not be desperate to work until you get what you want.
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How to avoid personal finance crisis

The uncertainty global economic is increasing. The Greek debt crisis has influenced the world economic. Some Europe country also suffer debt crisis such as Portugal, Italy, and others. The crisis may affect your personal finance especially the investors who invest the outside. They will loss:

1. Pay your debt immediately and do not propose another debt
Set aside your salary to the debt expenses. If you have more money, you should settle the debt immediately. Do not ever let the debt hang your neck.
The mortgage has caused some people poor because they cannot pay it. The credit card can cause the financial crisis. Some Korean people in financial crisis due to credit card. We have to better throw the credit card now.
2. Not dependent on your boss, your parent, you brother and your sister
In economic tight when the company may fire you, you should find other jobs to fulfill your basic need. You must be able to predict whether the company wants to bankrupt. If they late or do not pay your salary for month, you should be ready to find other company or other office.
Some people feel comfort with the parent. They think the rich parent will support him or her forever. That people must be unwise. If the parent needs more money, they should payback the money soon.
3. More save
It is difficult to save more when the good and service price multiply. However, you should save more to anticipate the crisis. Saving money does not mean we save the money at bank or certified deposit. This investment is not profitable today. Saving at bank may guarantee your money but it cannot protect the value of money.
That is why, people save their money at gold or silver. The gold and silver price is skyrocketing at last year. I am also worry that people will hunt the gold so the price will be unreliable.
4. Emergency fund
The emergency fund can help you to finance your living cost in short time or six month. It depends on the amount of emergency fund. This fund helps some unemployment while they cannot generate salary. The unemployment must need transportation cost to apply new jobs. They also need paper and envelope for applying a position in the office. 
5. Find some free
There are some coupons in internet or newspaper. Use the coupon to cut your spending. You may just get a gallon of milk, a slice of pizza, a con of ice cream but it can save few dollars.
6. Change your lifestyle
The economic is tight, you have to change your lifestyle now. The generic product is better than the brand product now for you.
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Financial Advice for teenage

A teen also needs financial advice too even they have not yet generate money. They may not know about finance or money because they have no jobs unless special teen who work as the artist or celebrity, such as Justin Bieber. Though the teen has no paycheck or salary, they should manage their money well. The parent should advice the kids so they can manage money when they grow up. Here is the financial advice for teen:

1. Budget
A teen that have able to calculate the number and graduate from mathematics subject must be able to create a budget. They can use a piece of paper or they can use spreadsheet. I believe the teen spending is not much as the mature spending. Perhaps their spending is just transportation cost, lunch, toys, and others. Most teen spending is paid by their parents. 
Remember what you spend last month and what will you spend next month. This is not difficult for the child to record the spending.
2. Frugal living
Do not ask your mother or father to buy the expensive gadget and toys like your friend? Your friend father may be a success business that has million dollar in stock while your father is just a clerk. You just need a simple phone to connect with your friend or you may need a notebook.
As the teenager, you do not need own car. It needs service and maintenance. You can use bicycle to go to school or the school bus.
3. Saving
Your mother gives $ 100 per month but you do not spend the entire of money. You do not need to back to your mother. Keep the excess cash to your cash box. You may need the money when you grow up or you can collect it buy games, software, baseball card, and other.
It is better to buy the toys with your money than asking to your mother.
4. Try to find little pennies
In my country, a couple kids make English course games. The games can help the foreign English to learn English fun. The kids generate royalty when they young.
Why do not sharp your skill when you are young? You are young and your parents support you with money. They also allow you live inside the house.
Some kids offer the service to the neighbors. Mowing the yard is not a bad idea. The neighbor may like what you do.
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