November 10th, 2008 — Debt, Leverage, Money, Personal Finance, Stocks, Wealth
If you’ve ever had a chance to invest in a great stock but didn’t have enough money put aside to take advantage of the opportunity, you know too well the agony of defeat. Most of us are under the impression that it takes money in the bank to start investing. If you’re not financially stable or independently wealthy, that means that you’re going to have to watch a lot of opportunities pass you by. Or does it?
There is a way that you can start taking those opportunities by the horns right now, before you have money put aside. Debt leveraging, when used properly, is an incredibly powerful tool that can really make the difference in your financial future. In most of us however the word debt conjures up some pretty unpleasant images. We’re all trained to think that debt is bad, that debt will ruin you and that debt should be avoided at all costs.
What if you were to change your way of thinking and embrace the fact that debt can be a very powerful tool? What if you stopped thinking of debt in only one light and realized that there are many different kinds of debt? We’re not here to tell you to run out and buy everything your heart desires, racking up all sorts of debt. That is why debt has such a bad reputation. The temptation to buy things we don’t need or can’t afford is pretty strong and millions of people end up falling into debt traps every single year.
That is mainly because they don’t use debt to make money. They use it to spend money and end up in way over their head. Instead of looking at debt in the traditional manner, we want you to start realizing that debt has the potential to change your future. You can use debt to start making those smart investments and start reaping their benefits right now.
Let’s say that you have the chance to purchase ten shares of a stock with your own money in the bank. It does well and you get a nice little payday. Wouldn’t it have been nicer to purchase ten thousand shares and retire? By getting a loan to purchase those ten thousand shares, you could have made more than enough to cover the costs of that loan and still retire. You can keep thinking small and making little returns here and there, but over time, they’re going to get eaten up.
If you want to make it big, you’re going to have to start leveraging debt in a smart way. We’re not saying get a loan and blow it on a non-performing risky stock. We’re saying, find the opportunities, research them and when you’re sure you’ve got a winner on your hands, go all in. Don’t waste your time with a few shares here or there. Get that loan, use options, and/or margin your portfolio to get more shares and get the benefits that debt leveraging can bring.
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August 28th, 2008 — Banking, Income Streams, Money, Personal Finance
For many of us, saving is something that we always plan to do, but never quite get around to it. The bottom line is, if you don’t have a savings account and a regular plan for putting money aside, you may regret it in the future, especially as you get closer to retirement. A savings account can be incredibly useful in an emergency and it can also help increase your odds of getting a loan in the future when you may really need it. So, how can you start putting money aside right now, even if things are tight? Here are some tips to get you started.
First, it’s important to remember that saving money doesn’t necessarily mean putting thousands of dollars away every month. It’s ok to smart small, and in fact, this can help you build up some great saving habits. Even if it is only $5 a week, putting money aside is a great idea. It will add up, especially if you can find a savings account that has a great interest rate. Granted, you’re not going to get rich putting away $5 a week, but it is a start.
Next, you will need to open up a savings account. While it’s perfectly fine to put money in a drawer or just keep it in your checking account, it is simply too easy to access it. By putting that money into an actual account, you’ll be less tempted to pull from it, unless you absolutely need to. Shop around for a savings account before jumping in, since interest rates can vary greatly from bank to bank. If you have a habit of blowing through your money, you can put your savings account book away in a safe deposit box.
Once you’ve gotten into the habit of putting money aside, you can start looking at ways to make more money to add to that account. This can help increase your savings without scrimping. Unless you’ve already got a lot of disposable income, it can be tough to find enough money to save when you are buried in bills. This means that it may be necessary to investigate some money making options.
The most ideal option is to find a way to create another solid stream of income. Once again, you can start small with a little investment that will start returning money every month. Put that extra income directly into your savings account and watch it grow very quickly. The key is to keep making those investments and to keep moving forward. Never get stagnant or rely too heavily on just one income stream.
If you have a hard time finding any money to put aside each month, it may be time to revisit your finances. Whether you just overspend, or you are not making enough to support yourself at your current job, you’ll need to take a hard look at your finances and determine what can be changed to increase your ability to put money aside.
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June 13th, 2008 — Leverage, Money, Personal Finance, Wealth
This is probably one of the most commonly used books by those who are looking to create wealth. It first came onto the scene in 1926, and shot to fame during the Great Depression as the desperate populace looked for a way out of poverty. While this book does raise many good points and offers a lot of good advice for standard money management, it is important to consider the time in which it was written.
It’s set up as a bunch of fables that all teach a lesson. While this is helpful for some readers, it can be pretty frustrating if you’re just looking for some hard hitting facts. Unfortunately, the morals in the stories are pretty much already well known. Don’t spend what you don’t have, put money aside for your future, and make smart investments. Most of us learned this before we even hit high school.
The central problem, at least as how I see it, centers around the fact that the fables all involve people who already have at least some money in their purse. After all, you’ve got to have money to make money. What it doesn’t cover is what to do if that purse is already stretched to the limit with normal living expenses. No matter how hard some people try, there just isn’t enough at the end of the month to sock away. Are these people then doomed to a life of living paycheck to paycheck?
The process of leveraging debt to secure your financial future is really nothing new. People have been doing it for thousands of years. Whether it’s as simple as getting an investment to start a new company or getting a loan from a friend to invest in a hot stock, leveraging debt is still one of the best ways to start making more money right now. And for those of us with moths living in our purses, it is the only chance at creating alternative streams of income.
That said, this is still a good book and there are some important lessons that can be gleaned from it. However, it is best suited as a primer for those who need guidance for personal management of their funds or for teenagers that are just getting started in the financial world. If you’re looking for a book that’s going to tell you how to fill up that empty purse, your answers will not be found inside its covers.
There is nothing wrong with this book per se, but it did fail to cover techniques that are already proven to help people make money. While you can easily follow the advice and have a safe and steady income over time, for those looking to dramatically increase their wealth in a short period of time, the book is a bit of a disappointment. Buy it, read it, and put it aside to give to your children when it comes time to learn about managing their checkbook and saving for their futures.
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