How To Start Investing For Financial Independence, Part 2

Written by Chris Anderson, PhD

Last week, we started a multi-part series about how to go from being a beginning investor to being “financially independent” in a steady and predictable way. Many, many people want to overly complicate this process so let's briefly, let's recap that discussion. The bottom line steps that I suggested inrepparttar last article was: 1) Look for an opportunity that will return at least 150% in 2 yrs or less; 2) Be mentally and financially prepared ifrepparttar 147922 investment does not work out; 3) Have VERY good reasons why you don’t think you will lose money…… You may not make as much as expected, but you would rather not lose money at this stage. 4) Be patient. This single result should not either make or break you but it is crucial to a longer term plan. I gave an example where a hypothetical person had gone through this process and ended up with a profit of $43,000 (before taxes) and $36,000 of after tax profit. When this profit was combined with their original investment, they now had around $55,000 of operating capital for Step 2. Before we get to Step 2, let's take a step back. For a lot of people, if I told them that somebody made $43,000 on a quick investment, they would think these people had "struck it rich". Kind of like winningrepparttar 147923 lottery, right? NO! Inrepparttar 147924 grand scheme of things, this investment will do very little to impact their financial independence. That is, it will take discipline to now use these profits to go intorepparttar 147925 next investment, and then use those new profits to go intorepparttar 147926 3rd investment, etc. So, in our opinion, this first investment was merely a stepping stone towards a much bigger objective. In Step 2, most savvy investors will now realize they have just been given some extra monopoly money, or money that was not originally theirs, to work with. Inrepparttar 147927 investment and trading world, this is referred to asrepparttar 147928 "market's money"; i.e., money that you got fromrepparttar 147929 market that you can then use to generate revenues above and beyond what was possible with your original investment. Quality traders can use this concept to produce huge % returns in a year while risking no more than 10% of their original portfolio. So let's sayrepparttar 147930 investor now decides to repeatrepparttar 147931 process and buy two more preconstruction lots in a different development. Inrepparttar 147932 two years sincerepparttar 147933 first investment was made, suppose now that property has escalated. In addition,repparttar 147934 investor finds a good deal on two lots and each is $250,000 to purchase. Now,repparttar 147935 investors visits their check list to see if this makes sense: 1) Look for an opportunity that will return at least 150% in 2 yrs or less -- yes, they have reason to believe this will occur for their down payment amount; 2) Be mentally and financially prepared ifrepparttar 147936 investment does not work out--yes, they don't think it will happen but if they lose their entire 10% down payment, they are ok with this.

Euro Tax Haven Threat

Written by Roger Munns

Media reporting of a new EU savings tax directive has left many people wondering whether European tax havens could soon become obselete.

The July directive requires banks throughout Europe, including low and no tax areas such as Gibraltar, Monaco, Malta and Andorra, to disclose bank account owner information to their home country’s tax authority.

But Roger Munns, Managing Director of tax haven property specialists Tribune Properties, says that some ofrepparttar reporting has been less than accurate. ‘The purpose behind this directive is primarily aimed at those who hold illicit funds, such as drug dealers, who will need to look outside ofrepparttar 147823 European banking system to place large cash deposits. The main attraction of Monaco and Andorra isrepparttar 147824 zero per cent income and inheritance taxes, and this remains intact and there are no plans whatsoever to change this’.

Monaco and Andorra have long been favoured destinations forrepparttar 147825 well to do, but with new technology allowing businessmen and women to run their offices from anywhere inrepparttar 147826 world, operating from low tax bases has seen added interest for Europe’s primary tax havens, doubling property prices inrepparttar 147827 last ten years.

Both Monaco and Andorra are outsiderepparttar 147828 EU, and their signing ofrepparttar 147829 directive voluntarily is often overlooked inrepparttar 147830 media’s analysis of any effects onrepparttar 147831 two small countries long term popularity.

Property prices have risen steadily overrepparttar 147832 last decade, often topping ten per cent a year, but this year has seen a slow down of that increase.

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