Tag Archives: Investing

3 Reasons Why You Should Embrace Investing

 

Welcome back to our Managing Your Money series. Today is on Rule #5: Develop an Investment  Plan.

I’m about to break the #1 rule of blogging: Always pretend like you’re the expert.

I’ll admit, I’m a pro when it comes to budgeting, savings, and paying off debt. But the stock market is still a bit scary for me. And although I’ve had some success with real estate, I doubt The Donald knows who I am yet.

So this post is going to focus on the reasons for investing. If you want more practical advice on how to invest for your season of life and level of risk aversion, consult with a CFP in your area.

3 Reasons Why You Should Embrace Investing

1. It’s Biblical.   In the story of the talents (Matthew 25), the master says to each man who made a return on their investment “Well done, good and faithful servant!” This is where we get the biblical concept of stewardship. Proverbs 13:11 says “whoever gathers money little by little makes it grow.”

2. It Outperforms Savings.   Many people see investing as risky. But the truth is that risky investing is risky…there are safe ways to invest. But what isn’t safe is to let your money sit in a savings account and do nothing. “But I’m earning interest on it right?” Yes, but with the average interest rate being just 0.2 percent (as of 2009) you are actually losing money due to inflation.

3. It’s What The Rich Do!   A proven method for success is to find someone who has achieved what you want to achieve and simply do what they do. Don’t misunderstand me…many financially successful people are complete failures on a personal level. But if you want to grow wealth, follow the advice of the wealthy.

Robert Kiyosaki, famous for his “Rich Dad” books, said “The poor and middle class work for money. The rich have money work for them. The rich buy or create assets that work for them so they don’t have to.” Robert Allen said, “How many millionaires do you know who have become wealthy by investing in savings accounts? I rest my case.”

My Thoughts for Debt To Life Readers

Most of our readers are buried in debt. And honestly, it’s a little premature to start working on an investment strategy until you’re debt free. Focus your energy on getting out of debt and saving up at least 3-6 months of living expenses. Then I would recommend meeting with a financial planner to discuss an investment strategy that’s right for you.  

Committed to your success,

-Wesley

Comments: Which of the three reasons stuck out to you the most?

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The Seven Rules of Managing Your Money

The #1 key to growing wealth is understanding how to manage your money. In the outstanding book, Secrets of the Millionaire Mind, T. Harv Eker states that “the single biggest difference between financial success and financial failure is how well you manage your money. It’s simple: to master money, you must manage money.”

So how well do you manage money? Do you feel lost when thinking about your spending plan, your debt, and your investments? Do you ever catch yourself thinking “where did all my money go?” If so, you need to become a student of money management.

Don’t get overwhelmed, the rules of money management are simple. The problem we have is not in understanding the rules but in following them. We simply aren’t doing the things we know we need to do.

The Seven Rules of Managing Your Money

1. Take a Financial Snapshot: The first step in managing your money is to get an accurate picture of where you are financially. You may not like what you see but this is the first step to change.

2. Develop a Spending Plan: Give a task to every incoming dollar, such as buy food, pay the electric bill, or get rid of debt. Money gets lost when it doesn’t know where to go.

3. Develop a Savings Plan: Here’s where most people fall short. To grow wealth, saving is not optional.

4. Develop a Giving Plan: Want to read a crazy promise found in scripture? Read Malachi 3:10. It’s the ONLY time in scripture where God tells us to test him.

5. Develop an Investment Plan: To quote Eker again, “Rich people have their money work hard for them. Poor people work hard for their money.”

6. Track your Spending Weekly: Wealth is like a road trip, and tracking your spending is the same as keeping the car between the lines. Constantly checking and adjusting.

7. Review your Plans Monthly: This is like checking the map on a long trip, making sure you’re still on the right track.

I’m assuming if you’re reading this that you’re in a place where you are ready to take action and get control of your finances. Today is simply an overview of the seven rules of managing your money, however, stay with us for the next two weeks as we go into detail about each rule and how to take immediate action on each one.

Committed to your success,

-Wesley 

Comments? We love hearing from our readers. Let us know which of the steps you’re working on!

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