Idea here is how one can understand and implement basics of financial planning . The objective is that we start managing our money else someone else will manage it for us and make profit out of it.
The first principle of money management is to manage yourself first .which means that making oneself aware that money we spend is important. Why the word spend is important because if ” Money Management Is your problem whatever you earn is not going to be enough.” Rich dad poor dad ” is the book one should read to generate long term wealth.
There is no shortcut to generating wealth it needs consistency patience and confidence in wat you believe in.However its important to understand few basic patterns of your long term investment strategy. In India there are majorly 6 basic form of investments .The form of investment you choose will define your strategy of managing your finances and the long term and short term habits you develop.Let’s now clearly understand how this 6 strategies of investment operate.
Tounderstand this better let’s look at how a common man with a common sense thinks.
1.I want good returns on my investment 10 percent plus with guarantee of capital.
2. I want to earn larger profits in short term say 3 to 5 years .
3. I do not want to lock money and whenever i want it should be available to me.
Considering these 3 priorities the 6 investment strategies which evolve are 1.Gold Silver strategy 2.Equity Strategy 3.Real estate strategy 4.Guranteed return instruments 5.Tax planning strategy 6.Investment and life protection strategy.
Going forward we will look at how each strategy works and wats best suited to diffrent temprament of investors,
- Nicole Theisen of Buckingham talks financial planning (bizjournals.com)