on personal finance
Capitalism operates through markets. In an ideal scenario, goods and capital move freely in the market. The fundamental premise is that the market, if left to its own devices, can solve almost all economic problems through sharing, synergizing, and mutual learning. However, in some ways, state intervention is also required to help markets function with optimum efficiency.
In financial matters, operating through a checklist is very useful. This is the best way to avoid the pitfalls that one is likely to commit in the heat of a moment. Most of the investment options will reach you through a smart marketing campaign and, apparently, will look quite attractive. Hence, it is important to have a checklist ready that should help you quickly see through such options for their validity and viability. The most important point in this regard is a skeptical mindset which should have a bias towards ruling out all the grey areas and seeing clearly whether a particular risk is worth taking or not.
Some numbers and ratios are very useful in financial planning. They enable you to set realistic and achievable financial goals. They also help you quantify your financial aspirations and make it easy to navigate through the challenges that come your way. You can make correct financial decisions with the help of these numbers and ratios.
Whether to start your own business or to invest your money somewhere is a question most of us confront in life at some stage. While starting your own business puts you in the driving seat, it also exposes you to a wide range of risks. Investing, on the other hand, has its own challenges.
In this blog post, I will briefly cover the pros and cons of investing vis-a-vis starting your own business.
You might have observed, as I often do, that despite earning a fairly good amount of money regularly, some people continue to struggle financially. If someone is earning less, it is understandable why he is worried about money. However, if somebody is getting a decent salary or earning well from his business regularly, the financial worries can be attributed only to lack of proper management of money. This is as important or even, sometimes, more important than earning.
In this article, I will briefly highlight some of the reasons why people remain worried about their finances.
Personal finance is a very important aspect of our life. Therefore, money management should be done deliberately and carefully. Failing to do so may have grave implications. In this blog post, I will discuss a few points which should help you manage your finances effectively.
It must be kept in mind that money management is the link between the resources available and your financial goals. If this link is not strong enough, you will not be able to optimally utilize your resources for the attainment of your goals. This is going to create a lot of mental stress.
Quotes can be interesting as well as powerful. However, in order to make them attractive, they might have an element of exaggeration in them which can be ignored. Good quotes can condense the wisdom into a small piece of text, which is easy to remember and can influence our behavior positively.
It may be pertinent to try to understand a particular subject through some powerful quotes. With this in mind, I am going to include here a list of quotes that are full of financial wisdom. These can provide some very useful lessons in personal finance.
Your ability to design a portfolio that best suits your financial needs has a central importance in personal finance. While smart capital allocation is the process or the framework, portfolio is the product or the outcome.
The process of designing your portfolio is also a balancing act where you accommodate different variables and reconcile various divergences. However, the central theme of capital allocation and portfolio construction should be to outline some realistic and achievable financial goals first and then have a simple and workable plan to achieve those with the available resources in a given timeframe.
Raising our children to become civilized adults and useful members of society is one of the most important responsibilities of parents. All of us want and try to give the best possible education to our children. A good education must ensure all-round grooming of children. The existing education system lays a lot of emphasis on some areas while leaving the others unaddressed. One such neglected area is personal finance. That is why some very brilliant professionals, who are a product of this education system, are found struggling when it comes to money matters.
Investing is committing your money to a business operation now, with the expectation to take out more money later. It has three core principles. The first and the most important is to protect the investment capital (the principal). Secondly, no investment is possible without thorough research which has many dimensions and takes time. Lastly, you have to be content with an adequate return. There should be a way of determining how much is adequate. This succinct framework of investing was propounded by Benjamin Graham in his book: The Intelligent Investor.
