Financial control: they don’t think about it, but in vain
Today we will talk about financial control in your life. How, ideally, your total capital should be divided in order to protect yourself as much as possible from all kinds of surprises.
Financial experts recommendation: divide all income into three parts. The first part is your current capital , i.e. money for fixed expenses. Rent, funds for food and clothing, loan payments, car maintenance, garage, here is all entertainment, recreation, travel. This is the money you use every day.
Calculate how much one month of life costs you: write down all the mandatory expenses and add here what is not necessary, but you want and you buy. This will be your required minimum.
Everything that appears from above should be transferred to the second part of the capital – the “piggy bank” or reserve capital . This is your money “in reserve”, “airbag”. It is necessary to save here at least 10% of income, and when there is an opportunity – more. It needs to be formed constantly, during the entire time when you have stable income. Life is fluid, especially if you only have one constant source of income: the risk is even higher. Those of you who say there is nothing to save are increasing your risk dramatically on your own.
You won’t even notice the deferred 10% of income today, but for a year it is already 120%, a tangible amount. The sooner you start doing this, the better. The optimal size of the airbag is when you can not limit yourself and live as you are used to for at least 6 months, and preferably 2 years. If you have a cash reserve, with the onset of any force majeure, you will already be calm, you have a “safety margin”, you can not panic and rush to the first job offer that comes across, because in a week you have to pay loans and you have no funds.
You will be able to move on and look for a new job and new income opportunities in peace. Do not forget about compulsory health and life insurance for yourself and your loved ones – this is also included in the reserve capital. In our country, this is not very popular, but in vain. Since there is no insurance culture, when a force majeure occurs, people do not know what to do, this is seriously unsettling. However, when you are protected, life is much easier.
Reserve capital can also be stored in cash under the mattress, but it is better to put it in a safe bank. It is important to save money here, not to increase it, so it is worth choosing a bank according to the criteria of reliability of work, and not according to the amount of possible interest charges.
And the third obligatory part of capital, which very few people think about at all, is investment capital . This is what multiplies your money every day. Today investing is available to absolutely anyone with any income level.
There are US brokerage sites where you can buy ready-made stocks in installments starting at $ 10. Russian analogues have already appeared, with entry to the market from 1000 rubles.
Investing should be of two types: long term and short term. Short-term investing is deposits (although there are very funny% of charges that do not even cover inflation), company stocks, bonds. Of the high-risk, but more profitable types of investments – trading on Forex or cryptocurrency exchanges. If you do not know how to trade on your own, it is better to entrust this work to professionals who will make you income.
Long-term investment is real estate, precious metals, art objects. Even in these areas, you can now enter with small amounts at the start, from $ 1000 into housing programs, from a smaller amount – investment in art.
As you can see, there are a lot of possibilities. In the Amir Capital community, we are constantly exploring various modern investment instruments. The sooner you start planning your life, the sooner you will feel solid ground under your feet. And no financial crisis, unexpected job loss or health problems will take you by surprise.