Before you start any long-term investment plan

[Get your basic financial house in order] 

When we are single saving seems easy, and budgeting even easier. However, when marriage and children come along, it becomes more difficult to keep to a budget – because the more people in a family the more views and difference there are bound to be on how to budget or invest. 

This brings into play the matter of investing in the stock market for our children or placing funds in a bank and enjoying the benefits of the magic of compounding, not only does the principal investment increase each year but this year’s earnings also become next year’s principal, and even more earnings are accrued – it looks like magic because instead of increasing in straight line, compound investment increase geometrically. 

The process repeats itself as long as the money is left to grow, in other words what appears to be only a small change in rate of return can make the difference between poverty and comfort in our and our children’s future. The better way is to know when to invest – I think no one should invest until they have at least a six-month cash reserved for emergencies, the proper insurance protection and the basic legal documentation. Emergencies can include unexpected hospital bills, poverty damage, loss of loved ones, and perhaps even retrenchment.

It will not do us or our family any good to get only 30% rate return if we lose our job, die or we are disabled tomorrow – which think poorly about it. You can live once but what happens to your tomorrow, if you live till there. In any sense, life and disability insurance can buy us time. Understanding the value of time, and having patience to through down markets is a quality that will keep us from bailing out of a good investment at the first decline in price. 

Create Wealth, Not Just Income.   

Nobody can protect an investment better than the investor, which it is a logical promise when it is considered that the stockbroker, analysts and portfolio managers do not have the same vested interest as the investor. While experts use their ability and skills to manage a portfolio efficiently, they can not provide a guarantee of success.  Today, an investor can access all the information needed anywhere just by fingertip away, enabling better quicker and more accurate decision-making – although too much data can also be confusing. Where does one start? Should the investor assess global trend first, or Should the domestic market be a priority? 

💡 Basic tips on how to be a more informed investor:

• No investment is risk free.
• It is always an investor’s personal responsibility to make a careful and independent assessment of his or her financial situation and investment goals before making an investment.
• Assess all investment products on offer and never be rushed into making a decision.
• It is imperative that the serious investor build up a financial library to assist him or her in developing an investment strategy.

Do what’s right today, tomorrow and for your future you.

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