Here are some useful finance tips to get you started on the
right path to your finance success. Knowing how to secure
your financial well-being is one of the most important things
you'll ever need in life. You don't have to be a genius to do
it. You just need to know a few basics, form a plan, and be
ready to stick to it. No matter how much or little money you
have, the important thing is to educate yourself about your
There is no guarantee that you'll make money from investments
you make. But if you get the facts about saving and investing
and follow through with an intelligent plan, you should be able
to gain financial security over the years and enjoy the
benefits of managing your money.
No one is born knowing how to save or to invest. Every successful
investor starts with the basics. A few people may stumble into
financial security - a wealthy relative may die, or a business
may take off. For most people however, the only way to attain
financial security is to save and invest over a long period of
time. Time after time, people of even modest means who begin the
journey reach financial security and all that it promises: buying
a home, educational opportunities for their children, and a
comfortable retirement. If they can do it, so can you.
Your "savings" are usually put into the safest places or products
that allow you access to your money at any time such as a savings
accounts. But there's a price to pay for security and ready
availability. Your money earns less interest as it works for you.
Most smart investors put enough money in a savings product to
cover an emergency, like sudden unemployment. Some make sure
they have up to six months of their income in savings so that
they know it will absolutely be there for them when they need it.
But how "safe" is a savings account if you leave all your money
there for a long time, and the interest it earns doesn't keep
up with inflation? Let's say you save a pound when it can buy
a loaf of bread. But years later when you withdraw that pound
plus the interest you earned, it might only be able to buy half
a loaf. That is why many people put some of their money in
savings, but look to investing so they can earn more over long
periods of time, say three years or longer.
You may prefer to invest your money in order to achieve a higher
return compared to savings but you should be aware that when you
"invest," you have a greater chance of losing your money than when
you "save." You could lose your "principal," which is the amount
you've invested. That's true even if you purchase your investments
through a bank. But when you invest, you also have the opportunity
to earn more money than when you save.
All investments involve taking on risk. It's important that you
go into any investment in stocks, bonds or mutual funds with a
full understanding that you could lose some or all of your money
in any one investment.
Article written by John Mussi.
About the Author: Author Bio::
financial planner WA
comprehensive wealth management WA