Our grandparents used to collect commodities and save money in lockers, as their money management plan. Our parents plan was to invest in gold, silver, and in real estate. But today, gold, silver, and real estate are priced too high and saving money in the locker isn’t enough. So, what are your plans for the future? You need a balanced money management because. Money Management is a process of investing your finances to achieve a higher yield. This is also a systematic analysis to assess all your assets, liabilities, investments, banking and taxes.
First things first, you’re required to be sincere about this management, you cannot leave at any random stage. You will need to analyze your earning and deduct the regular expenses, such as power bills, EMIs, groceries, etc. The remaining amount will be your savings, but we will take out a share of the savings too or else this plan will collapse. You might ask, why that is? Well, it’s human nature to not be satisfied at any given point, there will always be a craving for spending. Thus, you should take out a small percentage of your savings for miscellaneous expenses. Finally, you will get the right amount for your money management. Don’t worry if this amount is not much. Be thankful that you still have some money left. It’s not like you cannot get results with less money, our cryptocurrency example will clarify this to you in an upcoming paragraph. Following are some money management ideas that you can follow.
Portfolio
Since property rates are higher, it’s a good idea to start your investment in the stock market. But what is a portfolio? It’s a simple investment strategy that will allow you not to put all your eggs in one basket. Investing all the money in one company or in one sector is never recommended. Instead, you should diversify your investments to several business sectors to minimize the risk. One company or one sector may fail to deliver, but different sectors cannot fall altogether.
SIP, MF, and Health Care
Choosing systematic investment plans and mutual funds are equally good when you’re incapable to handle your own portfolio. Such a plan requires you to pay small monthly premiums and you get a lump sum payout at the time of maturity. An exact amount cannot be guaranteed, but be sure that the amount will be multiple times greater than the banking interest. Also, buy health care plans for each member in your household to have a backup plan when you might it the most. The premium costs are petty compared to their worth value, and that’s a good tax management plan too.
Cryptocurrency
A new era started in 2009 with the launch of ‘Bitcoin’, a digital currency that is encrypted in blockchains. It’s the first decentralized currency, which already seems very futuristic. Too bad that very few people believed in it. A guy named ‘Kristoffer Koch’ bought 5000 Bitcoins for $27 in 2009, and today, a single Bitcoin is worth $6370. See, how a little investment could also make you a multimillionaire, you’re just required to be open to the opportunities. Yes, you skipped the first train, but Bitcoin is still running its marathon. We have seen a 700% growth in 2017 only. However, there are many other cryptocurrencies available which are doing good and are still in their early stage. It’s a good idea to have a little investment in them too.