Get control of your finances!Written by Clare Evans
When it comes to money we tend to fall into three main categories: spend less than we earn, spend what we earn, spend more than we earn. If you’d like to have more money each month or want to get control of your finances read on.Create some good financial habits by taking a look at where you are now. Where do you want to be? Follow these tips to help you get there. - Keep a money diary for a week. If you don’t know where you spend your money, you can’t start making changes. Carry a notebook with you and write down every single penny you spend as soon as you spend it, every day for a week – every bill, standing order, newspaper, snack, bus fare, coffee … At end of week look at where it all went. Can you see any areas where you could make changes? - What is your minimum survival income? How much do you need to pay for basics like mortgage, rent, insurance, bills, food and car each month? Aim to save at least three times your monthly survival income with easy access in case of emergency. - Your monthly expenditure. Work out what you spend monthly on everything else: meals out, entertaining, clothes, holidays, presents, credit card repayments etc. etc. Including basics, compare your total outgoings with your income. Where’s fit? Are you overspending? - What are any debts costing you each month? How much do you pay in interest? What would you rather be spending that money on? If you can create some spare income each month can you put it towards ‘busting’ some of your debt. Contact me for a specific debt-busting exercise.
| | Defining Investing RiskWritten by Ioannis Evangelos Haramis
"Take a chance! All life is a chance. The man who goes furthest is generally one who is willing to do and dare. The "sure thing" boat never gets far from shore." Dale Carnegie (1888 - 1955) In 1998 Economics Professor and Nobel Prize winner Paul Samuelson (1915 - ) noted that, "Many people now believe that if they simply hold stocks long enough they will not, lose money for statistics have shown that since 1926 U.S. equity market has not suffered a loss in any given 15 year." He called it a fallacy, and conceded that it is truly likely that if you hold stocks over long periods of time that they would tend to produce returns higher than other assets. But to believe that it is a God given statement ... Is simply not correct! "Risk does not go to zero over long periods," but there are many articles that reflect how risk goes down longer time period. What is seldom introduced is fact that if there is a significant onetime loss, it can be monumentally overwhelming. In any case Samuelson noted that: "The problem is that when stock prices do turn down (as inevitably happens even in strongest of bull markets!) your optimistic equity exposure can overwhelm your gut level risk tolerance, leading to poor short-term judgments and even outright panic!" Risk is a complex, multidimensional concept that manifests itself in various ways. Risk is omnipresent and includes stock market crashes, corporate bankruptcies, currency devaluations, changes in sentiment, in inflation and interest rates, and even major changes in tax code.
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