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Manage Me 7.0 » » personal finance

Category: personal finance


Ways To Achieve Financial Independence

Financial independence is what we all dream of in one or other way. Might it be about being a millionaire or never having to work again or having a stable residual income or have sufficient assets to live a certain lifestyle etc. Sometimes, instead of achieving it, people waste a lot of money, time, and energy in seeking out means to grasp it even when the real ability to achieve the financial independence is right in their very own hands.

Whatever it is meant from being financial independence, the most important thing is how to achieve it. Following tips crave your path towards a financially independent lifestyle:

Figure Out Your Financial Priorities: You may never achieve your financial freedom unless you first define it before trying to pursue it. Defining your financial prioritizes can make it easier to curb spending on those things that are non-essential to your goal. Never eliminate the financial goals you find difficult to carry out, but be honest while committing yourself towards accomplishing your target.

Align Your Expectations With Bottom Line: Another tip to help you achieve your financial freedom is to realize just how much you’ll need to save to achieve it. You may think a million dollars will do the trick. Maybe it will, maybe it won’t. It all depends on your expectations. The person who truly wants to be financially free should always align his or her expectations with the bottom line.

Learn To Be Flexible: To achieve more of your dream try to bend a bit. As you map out your financial dream, consider what you might be willing to do to get what you want. Maybe it means you could choose a less expensive home in a less expensive area or doing a second job for awhile or rent out your house during the summer while you travel to visit friends and family etc.

Living Below Your Means: The time-honored way to accrue financial security is to live below your means. Never spend more than your earnings, even if you could afford to. This would save your from the risk of spending what you could have saved. Remember, the most preferred way to overcome the biggest fear of running out of money, is to play it safe.

Have Control Over Your Time: You would come to know the reality of being wealthy when you have complete control over your time. No matter how much money you make, you aren’t wealthy unless your days are spent doing the things that you enjoy so much that you would pay to do them and have control over your time.

Say No to These Financial Mistakes

It is quite amazing but true that many of us do not prepare a proper financial plan to avoid any future financial damage. We often keep a blind eye on various financial mistakes which sometimes arise as a result of  ignorance, fear, ego, desire for immediate gratification and many more.

Well, mistakes are the best teachers, as the lessons learned are ingrained by the outcome of our failures. Finances in the same way let you learn what to do and what not to do. To achieve financial goals even a single financial mistake may be a detrimental one.

This post in intended to highlight some common mistakes that need to be avoided for a better financial planning:

No Proper Financial Plan: Lack of a financial plan, and not setting any financial goals can bring a lot of financial problems. A properly written plan with all short-term and long-term goals surely results into success. Reevaluation of the plan and tracking the progress often are basic ingredients of a proper financial planning.

Improper or No Insurance: A financial plan is incomplete without adequate life insurance plan. One major goal of a financial plan is to maintain the life style of your family whether you are with them or not. A common mistake we make is buying life insurance policies such as endowment plans or money back to save tax, also hoping to reap returns. Returns from such policies are much less compared to traditional investment products such as stocks, mutual funds, gold or real estate.

No Diversification: Do not put all eggs in one basket. This mistake arises when a major part of  portfolio is invested in a single or same type of financial instrument which increases risks resulting into high losses/profits. The right portfolio should be built by optimum allocation into different asset classes.

Tax Saving Without Consideration: Many taxpayers try to withheld too much from their paycheck for income taxes. They think of it as a way to save. Investing in different financial products on the consideration of tax saving without evaluating other parameters of financial products  is one of the major financial mistakes.

Idle Money: Money lying idle in cash or saving bank accounts generates negative returns. This is one of the biggest financial mistakes which we often make by ignoring the effect of inflation on the money invested. Insufficient funds in the saving bank account for emergency purposes.

No Investment: Spending money blindly and not considering about any investment is another bad money idea. Increase the investment amount as your income increases. Don’t wait for a lump sum amount to be accumulated to invest and don’t try to time the market. Develop a regular and disciplined investment approach.

High Debt: Small amounts of debt, or house mortgages and auto loans may be comfortable but realize that these can be hard to handle if money is tight. If you do acquire new debt, do so cautiously and after researching the best loan options. Always prepare a plan to keep a tight leash on personal loans and credit card debt.

The Heat Up Of Mobile Finance

The widespread reach of affordable Internet enables mobile phones have increasingly enabled the consumers to have a direct access to the Internet. The dramatic fall in the price of mobile devices and falling prices of data services available on a prepaid basis are the main reasons behind it. These two are also responsible for the effectively Internet access via mobile in all developed and developing countries. The Internet enabled mobile phones are to be the basic handsets of tomorrow.

Mobile financial services are very likely to become the next big thing that will attract millions of consumers all over the world. There are three kinds of mobile financial services:

Mobile Banking:
It enables customers with existing bank accounts to get connected to their bank or financial institution over the mobile network. They can use standard banking services such as bank account management (check balance, view transactions, etc.), credit / debit card management with it.

Mobile Payment:
Enables customers to make credit card payments and bill payments any time anywhere, from either a bank account or a mobile wallet.

Mobile Money Transfer: Transferring Money via international or national remittance hubs from and/or to a real bank account or a mobile wallet. It is is a peer to peer form of mobile payment mechanism which is most successful among other kinds of mobile transactions.

As the use of Internet is expanding day by day, consumers are becoming more comfortable with using their handsets for increasingly sophisticated purposes, which also leads towards adoption of electronic channels for financial services. Today’s successful payment services have been built using certain mobile-specific channels that even basic handsets could support. Moreover access to the Internet will enable providers to offer solutions that do not depend on the security solutions offered using the SIM card in the phone. The growth of the mobile Internet may cause a boom in a new generation of branch less banking providers, raising substantial questions about risks to consumers, as well as the future shape of the competitive landscape.

It is estimated that there will be more and more people within the reach of wireless communications in next few years. Devices like mobile phones, which require less energy than PCs and ATMs and which can be recharged by windup or solar power, would play an increasingly important part in mobile finance.

Set Up Your Financial Goals

Being different to each other, we all have different opinions, goals and priorities, and different attitudes to issues like finance. Due to this, our opinions, circumstances, goals and priorities continue to change throughout our lives. Financial planning, is also something that we can not do once. Financial planning needs a regular review of our financial position and goals.

Financial planning Stage1: This stage is about tracking where you are now. What is your income, your assets, debts and expenditure? How stable is your income? Does it remain constant, or is it dependent on factors beyond your control? And what about prospects, are you in an occupation where you can reasonably expect your income to increase year on year?

Financial Planning Stage 2: The next stage is about identifying your goals which depend upon your age, circumstances and individual tastes. For example, the young will probably be concerned with purchasing their first home, the early middle-aged with paying their kids college fees, and the late middle-aged with providing sufficient retirement income.

Goals: Goals exist within different time frames. These can be short term that might be to save enough for next year’s vacation, a medium term which may be to pay off your mortgage and the longest term one may be building a decent pension fund.

Step1) Identify and write down your financial goals.

Step 2): Break each financial goal down into several short-term (less than 1 year), medium-term (1 to 3 years) and long-term (5 years or more) goals.

Step 3): Learn through a money magazine, or a book, or surf the Internet, for how to take wise decisions that will increase your net worth many times over. Then identify small, measurable steps you can take to achieve these goals, and put this action plan to work.

Step 4): Evaluate your progress by reviewing your monthly, quarterly, or at any other interval progress to determine if your program is working. If you’re not making satisfactory progress on a particular goal, re-evaluate your approach and make changes as necessary.

Finances can be improved by by saving money and investing carefully without any specific targets but it is a good idea to have some general goals.

Tips to Save Money for Entrepreneurs

Starting up a business might not consume a huge amount of cash, but requires a huge cost to maintain it to cope up with today’s business environment. Sometimes, when the growth expectations of a business might not play out as it is expected, we need to focus more on cutting cost and expenses involved in running a business. Here are some common suggestions and ideas shared with you entrepreneurs to cut expenses prevailing in your businesses and how to save more:
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Saving Money In Your Own Home

It is not only about saving money on shopping, on electricity and water bills, mobile bills, on traveling etc., but there are a number of other simple things you can do to save a lot of money. Start noticing things around you, inside your home. You can save money by taking small but important things in consideration, which can be about anything like:
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Key Terms to understand when reading your Credit Card Statement

Continuing with our discussion on credit card statement, we would now discuss the key terms used in the statement and their meanings. The explanation given below would help you understand the key terms better and thus help you better understand your credit card statements;
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Importance of keeping Credit Card Statements

This blog will not give you any other saving tip but will tell you about the importance of keeping credit card statements for you as a credit card holder and why you should keep your monthly statements carefully with you.
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How to save when Dining Out

Restaurants – Our budget-buster!

We all love to eat out, for convenience, for great taste, or for any other reason, but the only thing that makes all of us worry is our huge expenditure on dining out.
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Money Reclamation - A smart way to save money

We  work very hard for earning a suitable amount of income for living a smooth financial life. We take due care in handling our hard earned money. But most of the time we do not realize that due to our negligence we might have goofed up with our money.
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