7 Specific Ways to Distribute Your Finances to Achieve Long Term Wealth

Ask the average person what money management means to them and the usual response will be along the lines of ‘Pay off all the Bills on time and try to save whatever is left over.’ – Not very inspiring nor sound like much fun huh? Here I outline a simple way to change the way you look at and treat money. An efficient and practical way to manage and monitor your finances and get out of debt, which is also fun and if done consistently…the long term rewards will be extraordinary.

Below are the 7 ways you should be distributing your money. – If you can, setup 7 separate Bank Accounts for each specific use, otherwise 7 Jars, Boxes or any feasible containers will work just as well to get you started. Be sure to do this on a regular basis which you must maintain i.e. Either daily,weekly or monthly.

1. Investments:

Allocate 10% of your money to be put aside solely for Investing. Only ever use these funds to purchase Investments. These investments should either generate you ongoing ‘residual income’ or capital appreciation/growth i.e. sell on for a profit. Once you gather enough funds/capital, purchase the respective investment and then start building up again until you have enough for the next one and keep repeating the cycle. This is by far your most important fund as it this that will ultimately work towards achieving your Financial freedom/Independence.

2. Long Term Savings:

5% of your money should be allocated for ‘one off’ purchases such as Cars, Clothes, Home Furnishings, Home Improvement, Home Entertainment. This should also be used for Vacations abroad/long getaways.

3. Long Term Expenses:

Another 5% should be allocated for any ongoing small Debt, usually Credit Cards or small Personal Loans.

4. Necessities:

These are your major living expenses and thus 55% will be allocated to this; Mortgage/Rent, Car Loan, Utility Bills, Food, Petrol/Travel Expenses, Subscriptions…you get the picture…

5: Education:

10% of your money is to be allocated to your continuous learning of Financial intelligence and Personal Development. This is very important as you can never stop learning and improving yourself. This would include; Books, DVD/CDs, Seminars, Workshops, required Travel and Accommodation expenses, Training Material and so on…

6: Fun:

This is another important fund. Life as you know is too short and if you don’t treat/reward yourself every now and again along the way, it can feel very laborious and get very boring. – 10% of your money goes here and at the end of every week/month/quarter you must blow the whole lot on a treat of your choice e.g. your favourite restaurant, the theatre, spa treatment. – You are only limited by your creativity…The idea being that you really enjoy yourself and acknowledge that you have put money aside specifically for this, and you don’t feel guilty about it!

7: Charity:

Wealth is to be shared, 5% goes towards giving back to those more needy. You can either make this a regular contribution or save and build towards a large donation to charities/causes of your choice. – The more you give back, the more you will receive…

Please don’t presume you need a lot of money to start doing this either, because you do not…You can start with very small amounts, the importance is making it a habit. Even starting with a small amount, the law of compounding will slowly grow it into something substantial. Teach this to your kids from an early age and just watch how quickly their financial intelligence will grow as well as their fortune!

The Need and Importance of Hiring Bookkeepers for Small Business

You can always get bookkeepers for small business but if your firm is of a manageable size and you have the time, you can do your own bookkeeping, either manually or via the help of certain specialized software. Doing it yourself means a couple of advantages for you like the fact that you save on a bookkeeper’s costs plus you keep the finances of your small business a private matter, instead of having an outsider know what’s going on. On the other hand, bookkeeping isn’t exactly as simple as people seem to think and additionally, most of the time owners of businesses however small, have a number of other matters to attend to without having this extra job to look after as well.

Hiring Bookkeepers For Small Business

Hiring bookkeepers for small business is nothing too complicated. What you need is someone who you can put your trust in, someone who is experienced in his job, one who listens to your advice as well as a person who can advise you if necessary. One of the bets ways to find a good accountant for your business is to go by word of mouth. In your field you are sure to have acquaintances who have similar requirements or know people in the accountancy field. Talk to your colleagues and friends about getting a trusted bookkeeper for your small business and there is a big chance you will get a number or two to call. If this doesn’t work, go online and search for bookkeepers in your area or city. Many bookkeepers often offer lower rates for permanent contracts or to first time customers as a trial. Be sure to look particularly for a bookkeeper who knows his way around a small business or has experience in working in one, because the needs of a big business are quite different from the needs of a small business. A thing to keep in mind whenever you hire your bookkeeper is that he is only hired to look after your accounts and books, not to do any decision making on your behalf unless you explicitly state it. Therefore it is essential that you always keep up with whatever work your bookkeeper is doing.

Doing Your Own Bookkeeping

You can easily do your firm’s bookkeeping yourself if you are so inclined. It would be in your best interests though to look up some bookkeeping tutorials online and learn some of the basic methods of ding things. Or you could even get a professional qualification or diploma in some sort of accountancy field. There are many universities as well that offer long distance learning courses that you can take up as well.

Insurance

If you yourself are a bookkeeper who specializes in small businesses then it is vital that you get bookkeeper insurance. This is due to the fact that the service you are providing is very important in nature, and mistakes are only human. Therefore by getting insurance you can protect yourself in the scenario that you mess up someplace. So, keep this point in mind even if you opt for expert bookkeepers for small business.

Waking Up From Financial Fairy Tales – Why Invest For Cash Flow?

Given rapid changes going on in today’s world, many schools do not train their students well in financial literacy. As a result, most people easily get ripped off by flawed financial information and lose money. Due to the spinning of financial fairy tales today, many people play the game of capital gains and deem it as the best way to get rich. However, it is important to note that there is a more sustainable way to gain wealth and that is cashflow. Let us now find out why investing for cash flow is good.

In today’s world, the real financial approach you should adhere to is cash flow because every single day, the top 10% in wealth collects money passively from the bottom 90% using it. Good education is no longer enough because schools train students to spend money for the rich. For example, buying cars.

Here, the harder the bottom 90% works and the more they earn, the more money flows out to the top 10%, making them ever richer. For example, when you work harder and earn more money, you buy more luxury items like branded watches (marketed as symbol of wealth and status) and these manufacturer will earn more money from premiums charged.

Given how powerful cashflow is to the rich, many have kept their secrets very well because they do not want others to be richer than them. However, being in today’s Information Age, information gets disseminated rapidly and the same applies to this secret to wealth. As a result, with information so much more accessible than before, it is much easier for us to get rich and to create wealth, you must have cash flow.

The importance of investing in cash flow lies in sustainability, consistency and predictability. Cash flow investments are better than that for capital gains (for e.g. buying and selling of stocks) because they do not depend on the market. For example, regardless of what shape the market is in, rental real estate will still exist because people always need places to live in. Instead, sometimes when the economy gets worse, more people will be forced to rent houses and this can provide more cash flow to the investor.

In comparison, if the economy is in bad shape, there will be a bear in stock markets and this will make capital gain investments like stocks things you wouldn’t want to hold. Here, investing for capital gains is gambling because markets always change and if you don’t change your strategy with it, you will lose. As cash flow are less dependent on market situations, they are instead evergreen investments and with less influence from the market, investors can get rich more consistently as cash flow builds up.

In conclusion, I believe investors now have a clearer picture of why cash flow investments are better, given that they are especially immune to market conditions compared to other financial instruments. Now, being armed with better financial artillery, win your war and enjoy the fruits!

Useful Tips for Carrying Out Online Banking Transactions

With the internet available in most homes and businesses across the globe, it’s understandable that consumers are presented with many opportunities such as online banking and even online shopping. In the United Kingdom,millions of people are now using the internet in accessing their bank accounts and millions also are regularly doing their shopping online. But on the other hand, most of these people are still concerned about the security of their accounts whenever they access it on the internet. Using a computer is said to be the safest way in either banking or shopping, but it is also advised not to let your guards down while you are making transactions online.

The possibilities of becoming a victim of online banking fraudulence are said to be very low,and online banks committed themselves in keeping it this way, because most online bank’s systems proved that they could not be easily attacked, instead most criminals turned most of their attention in gathering many of the information directly from online banking customers. Most often, these criminals are using Phishing where in they send e-mails at random, as if they have seem to be sent by a genuine online bank.

This is the attempt they make in order to convince customer to disclose their personal security information, a ,method seen more on websites run by scam artists. There are some usueful tips, however, on conducting safe banking transactions, the first being to know who you are dealing with. Always remember to type the bank’s web address into your browser. Never go to the site via a link from an email. Never divulge personal information requested through an email. Your bank would not ask for this information.

In case you are in doubt, try contacting the bank or the building society by dialing the given contact number. Always keep your passwords and PIN numbers safe. Be extremely cautious of unsolicited emails or phone calls asking you to give any information regarding your personal details or card numbers. Always keep this information a secret and be cautious of giving your information to someone whom you do not know.

Your online bank would never call or contact you just to ask you regarding your passwords, PINs, or any personal information. Third is always keep a hold of your money. Do not be fooled by certain convincing e-mails that offer you the chance of making easy money. If an e-mail looks too good to be true, the possibility for it to be fraud is there, and it is difficult to prove that the sender is who they say they are. And lastly always check your online bank’s website. If you are in doubt, check your online bank’s website since it is a good place for you to get help and guidance on every transaction on the internet that you make in a safest way. Also regularly look for specific information and guidance regarding on how to protect your PC and also yourself while making online transactions.

The most important thing to do in order to make your online banking transactions safe is by keeping your computer safe, because it is the most important tool in making your online banking transactions. Most internet security software is available for download or purchase on the internet, or you may purchase them at your local computer store. This is another and one of the most effective ways for you to protect your computer, your transactions, and also yourselves.

Effective Implementation of Financial Engineering Can Boost Company Profits

In today’s highly competitive business world, with thousands of people applying for the same job with similar qualifications, having an edge makes life easier. This is where a degree in Business Management from a reputed college could make or break the opportunity to land the job. Currently, it is one of the most important criteria for making progress in a chosen field.

Important Subject

One of the most important qualifications for many graduates is the Certificate in Financial Engineering & Risk Management or CFERM, ranked as one of the top five finance programs available for students, looking for a career in the treasury and securities markets. This discipline makes use of information from multiple fields which could include economics, computer science, statistics, applied mathematics and other branches, which is then applied to find creative and original solutions to problems relating to finance. There have been cases where some of these subjects comes in use to create new finance products for banks and financial institutions. The main users of financial engineering are the big investment banks, private equity managers, and insurance companies.

Adaptable Financial Solutions

Financial engineering has proved as an exceptional asset in the insurance and reinsurance market, where exclusive formulas gets invented, which allows insurance providers to compete for big policies without carrying a risk burden. This kind of reinsurance schemes allows insurance companies to share the risk with other companies by coming into an arrangement to share the premiums charged. Students learn how financial engineering gets adapted to find solutions to various finance related problems as well as to create new ways to adapt existing rules and regulations in finance packages or products which would benefit their clients. Another subject taught in financial engineering is portfolio management which advises investors on the risks of long and short-term investments, while keeping their returns high.

Minimizing Investment Risks

Recognizing and minimizing risks is one of the criteria of success that banks and financial institutions gets judged by their peers and the industry. A financial engineering graduate working for the company would be able to put the knowledge and expertise gained, to make sure that the desired outcome is favorable to the company. This works for companies engaged in a takeover; a financial engineer would be the right person to decide if it is safe to go forward with this investment opportunity. By minimizing the risks, a financial engineer can save a lot of money for the company on whether to go ahead with the buyout or to split the risk through diversification. This type of advice could save the company’s financial resources for when the investment does not live up to expectation.